Housing affordability – Government new plan
The Victorian Government has announced their Homes for Victorians plan, which includes a suite of policies focused on addressing Victoria’s housing affordability crisis. The policies, announced over several days, include policies targeted at assisting people trying to buy or rent housing, or access social housing options.
The government categorises these policies under the following initiatives to make housing affordable:
1. Supporting people to buy their own home
2. Increasing the supply of housing through fast planning
3. Promoting stability and affordability for renters
4. Increasing and renewing social housing stock
5. Improving housing services for Victorians in need
In regards to Housing Affordability. One of the major policy announcements is stamp duty relief for first-home buyers for purchases of new and existing homes. This reform is expected to help more than 25,000 first-home buyers by abolishing stamp duty for homes up to $600,000, and by providing a reduction in stamp duty for homes between $600,000 and $750,000.
The government also announced an amendment to the off- the- plan stamp duty concessions that aims to ensure only genuine home buyers receive the subsidy. Under the amendment, only home buyers who intend to make the home their principal place of residence or who qualify for the first-home buyer stamp duty concessions will be eligible for the off-the-plan stamp duty concession. This will apply to contracts entered into from 1 July 2017.
Doubling the First-Home Owner Grant to $20,000 in regional Victoria was also announced. The government expects this to help up to 6,000 first-home buyers. The grant will be applicable to contracts signed from 1 July 2017 to 30 June 2020, at which point it will be reviewed.
The government will also set a target to prioritise at least 10 per cent of all properties in government-led developments for first-home buyers, and has flagged Melbourne’s Arden precinct as a good example of how this could work.
The government will levy a Vacant Residential Property Tax on dwellings that are vacant for more than a total of six months in a calendar year. This means the applicable tax rate will be 1 per cent of the property’s capital-improved value, and tax liabilities will be triggered on a calendar year basis, as with land tax. The tax will be triggered from 1 January 2018. For more information on the grant see here.
The government also announced plans to unlock an extra 100,000 lots of zoned land in Melbourne’s fringe by December 2018.
The government identified improvements to the planning system to fast- track social housing redevelopments, and an extension to the Streamlining for Growth program to accelerate the planning and approvals process, which includes an investment to speed rezoning of strategic sites within existing suburbs. Additional applications have also been announced that will be assessable under the VicSmart 10-day online fast track process.
The government has also announced new social housing initiatives, including a new $1 billion Social Housing Growth Fund, the capital power of which will be used as leverage, and the investment returns used to underpin funding agreement for projects. Additionally, it announced $341 million for the renewal and expansion of public housing stock.
Other initiatives include (but are not limited to):
• Shared equity opportunities for first-home buyers, with the government offer to co-purchase properties with 400 first home buyers who meet the criteria for a bank loan, but lack a deposit.
• New rules for real estate agents, including new penalties of up to $31 000 for agents caught under-quoting.
• An inclusionary housing pilot program aimed to deliver up to 100 new social housing dwellings.
• Inclusionary housing in major developments which will allow a number of local councils to apply affordable housing provisions as part of rezoning and permit applications for major developments.
• $109 million to support homeless Victorians to find stable housing, and
• $9.8 million to support rough sleepers, which includes 30 new permanent modular and relocatable homes on public land by the end of 2017.