Earlier this month the federal budget was handed down and, while there might not have been anything specifically targeting Australian landlords, there was plenty to be mindful of in future investment endeavours.
In the budget announcement, Treasurer Josh Frydenberg shared that housing is now worth more than $8 trillion. And the importance of this to not only the Australia economy but in terms of social implications is not underestimated.
Perhaps the greatest risk for the broader community is loss of income. The effects of this in early 2020 were indeed felt by homeowners, landlords and tenants.
A large focus of this year’s budget is on jobs and training and the importance of keeping people (read: your tenants) skilled, trained and employed long term. This focus will hopefully prove beneficial to not only those within the property sector, but across the board.
The existing downsizer scheme which enables those close to retirement selling the family home, or ‘right-sizing’ their home, and contribute $300,000 into their super without a high tax penalty, has been lowered from 65 to 60 years of age. This aims to create an opportunity to open up more available property to the market.
With younger families finding it more challenging to own their own home, the demand for larger family homes where multiple generations might rent and live increases.
The opportunity to invest in such a family home may be one to look out for in the future.
The Treasurer confirmed an additional $10 billion in spending on a number of infrastructure projects throughout the country, bringing the total to $110 billion over the course of the next ten years, including $15.2 billion in new project funding. For regional centres, he announced $250 million allocated to community infrastructure projects under their Building Better Regions fund.
If it has come time to review where you are at with your investment property portfolio, looking to where money is being spent in infrastructure may give you a good indication of which areas may have promise. It may be beneficial to get in ahead of competition and buy property in an area that is expecting to see an increase in jobs through construction and, in the longer term, attract residents because of better infrastructure.
It’s always wise to review where your current investments are at and how you’re tracking toward your future goals. Keeping future planning in mind when it comes to expanding your portfolio will prove beneficial.