Advancing Housing Supply: Government Initiatives Explained

In a bid to tackle the persistent housing supply challenge, the Western Australian Government has taken a proactive stance by introducing the Duties Amendment Bill to Parliament. This move has drawn attention for its potential to enhance housing diversity and availability, signaling a positive step forward for the housing market.

The Bill's proposed amendments, including an extension of the off-the-plan duty scheme and adjustments to existing thresholds, have garnered widespread support for their potential to stimulate investment from foreign developers and bolster the housing sector.

The current housing supply landscape presents a significant challenge, and initiatives aimed at augmenting supply while fostering diversity are welcomed. By aligning with the Government's budget commitments for the fiscal year 2023-24, these amendments are poised to encourage development and urban infill, ultimately contributing to increased housing options for both potential buyers and renters.

The Government's financial commitment to extend the off-the-plan duty scheme is noteworthy. Originally slated to conclude in October 2023, the scheme will now be extended until June 2025. One of the primary changes is the shift from a rebate to a concession model. This alteration means that buyers will now receive an immediate discount on their purchases, introducing greater financial flexibility and incentivizing participation in the housing market.

Equally impactful are the revisions to the thresholds. Under the new provisions, buyers stand to gain a 100 percent concession on properties valued up to $650,000, a substantial increase from the previous cap of $500,000. As property values rise, the concession will gradually decrease to 50 percent for properties valued at $750,000. Properties exceeding this value will qualify for a 50 percent concession, capped at $50,000.

"These changes represent significant savings for buyers and will encourage off-the-plan purchases, supporting development of these projects," emphasizes the potential positive impact on the housing market. The modifications are anticipated to foster housing diversity and augment supply, a crucial step in mitigating the housing shortage currently afflicting the rental market.

Furthermore, the Duties Amendment Bill extends support to foreign developers through the expansion of a duty exemption. This exemption enables foreign developers to claim a refund of the 7 percent foreign buyers duty when acquiring land intended for the construction of 10 or more dwellings. Notably, the amendments eliminate the precondition that the land must be vacant, thus broadening development prospects.

In summary, the Western Australian Government's proactive approach through the Duties Amendment Bill holds the promise of addressing the ongoing housing supply challenges. By extending the off-the-plan duty scheme, recalibrating thresholds, and facilitating exemptions for foreign developers, these changes are poised to invigorate housing supply, stimulate development, and enrich housing market diversity and accessibility. As these initiatives take root, they are expected to play a pivotal role in surmounting current housing challenges and catalyzing growth in the real estate sector.

Do you think these changes will make a significant impact?

Paulette Contessi

Licensee / Director

THE CONTESSI GROUP