NSW Halves Land Tax for Build-to-rent development projects with the objective of accelerating construction and changing the way people perceive renting. This is a breakthrough for property developers in the BTR space.
For those of you that are not familiar with BTR development projects, this is a residential development comprised of apartments that are all owned by the developer and are leased out to tenants.
A potential turning point for the emerging sector, the state government will for the next 20 years issue a 50 per cent discount on land tax to developers investing in build-to-rent schemes.
NSW treasurer Dominic Perrottet said “the legislation would provide, greater certainty for renters, more housing options, boost developments and support jobs during the Covid-19 recovery.
“Build-to-rent is popular overseas, but still in its infancy in Australia and we want to remove barriers and allow this segment of the market to grow,” Perrottet said.
Renters will benefit from appreciable choice, better quality rental properties, and a sense of security with longer lease terms.
The eligibility criteria for the land tax discount for build-to-rent projects involve the construction of at least 50 units in metropolitan areas, with the regional area threshold still in consideration.
Construction must have started on or after 1 July and the projects need to provide purpose-built rental units, be managed under unified single ownership and include options for longer leases.
According to a recent report from CBRE, Australia ranks among the top five markets around the world with the best build-to-rent potential when all the investment fundamentals were taken into account.
Estimations are currently 12,000 build-to-rent units at varying stages of completion across Australia. – By CBRE
In Sydney, eight projects have been announced so far, including the recently completed Pavilions by Mirvac at Sydney Olympic Park.
For Further information refer to the NSW government link below: