The Queensland government will slash land taxes for Build-to-Rent developments that include affordable housing in a bid to deliver new rental supply in the state.
The Palaszczuk Government will slash land tax by up to 50% for BTR developments that feature at least 10% of rental homes as affordable housing.
The new BTR development tax concessions include a 50% discount on land tax payable for up to 20 years; a full exemption for the 2% foreign investor land tax surcharge for up to 20 years; and a full exemption from the Additional Foreign Acquirer Duty for the future transfer of a Build-to-Rent site.
The announcement comes as a new Cushman & Wakefield report this week has shown that while build-to-rent units were typically premium offerings, removing a unique tax impost for the sector could reduce rents without compromising the hurdle rates needed to attract investment.
Treasurer and Minister for Trade and Investment Cameron Dick said the private construction sector was at capacity across Australia.
“Our government is working with industry to identify innovative ideas that create new pipelines of housing supply,” he said.
“The Build-to-Rent projects that we’ve already brought to Queensland are already boosting rental supply.”
Queensland Treasury will consult with the property industry on the land tax concessions ahead of proposed 1 July 2023 commencement, to ensure they can support the delivery of more homes for Queenslanders.
The state government expects the land tax concessions to help unlock more investment into housing and build on three developments supported under its Build-to-Rent Pilot Program.
Combined, these current developments in Newstead, Fortitude Valley and the Brisbane CBD will deliver more than 1,200 new dwellings, of which up to 490 rental homes will be provided at discounted rent thanks to a Palaszczuk Government subsidy.
The state government also recently released a new invitation for Expressions of Interest under the $2 billion Housing Investment Fund last month.
This process was targeting proposals with ready-to-proceed social and affordable housing developments on privately owned sites, including affordable-only proposals.