WA home buyers and property owners were given a reprieve in the State Budget, with no new property taxes and no increases to current taxes announced.
REIWA welcomed that decision, but criticised the lack of initiatives to address housing affordability or reinvigorate the property sector.
President Hayden Groves said while it was pleasing there were no increases to property taxes, this year’s budget was a mundane budget for the property market.
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READ NOW“We are particularly disappointed that the First Home Owner Grant (FHOG) remains unfairly skewed towards new-build properties and that there is no transfer duty concession for seniors to enable them to ‘right size’ into more suitable accommodation,” he Groves said.
Master Builders had called for a $5000 boost to the $10,000 FHOG for people building in regional areas, which was not forthcoming.
“We are disappointed that the treasurer didn’t see merit in providing a 12-month $5000 boost to the $10,000 FHOG for home buyers in regional areas who are doing it harder than their metropolitan counterparts.” director Michael McLean said.
Overall he said there were no real surprises, no radical changes and no negative impacts which should deter the building industry’s prospects in 2018-19.
“We anticipate the next 12 months will be tough again for most businesses in the building industry but the conservative and disciplined approach to state finances will help to boost consumer confidence which will stimulate renewed interest in the new home and renovation sector,” he said.
The Urban Development Institute of Australia was also pleased to see no increases to stamp duty or land tax.
“We are glad that the government has refrained from using the broader property market as an easy target for revenue raising,” chief executive Allison Hailes said.
“However, as we outlined in our pre-budget submission, a major review of WA’s property tax regimes is required to ensure a more sustainable and efficient system moving forward.
“The budget papers show that revenues from total transfer duties are forecast to fall 0.4 per cent in 2018-19 ($6 million) following a decline of 4.7 per cent in 2017-18.
“Overall revenues are expected to be much lower than previous years moving through to 2020-21.
“These declines reflect the volatility in the nature of transfer duties and a move to a more stable system that is not so reactive to the peaks and troughs of market cycles would be much more efficient and stable.
“We believe a broad based land tax system such as that introduced in the ACT could be the answer here.”
REIWA also called for a review of property taxes in its pre-budget submission.
“In the long term, a complete tax review is needed to ensure taxes are being utilised as efficiently as possible,” Mr Groves said.
“REIWA recommends a report into phasing out transfer duty in favour of a broader-based land tax.”
All three organisations expressed concern regarding the increase to the foreign buyers surcharge.
Due to come into effect on January 1, 2019 it was originally set at 4 per cent but was raised to 7 per cent.
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