June 2020 Finance Update
As we count down the last days of the financial year, there’s been some positive news for buyers, homeowners and business owners.
Property investors receive encouraging news
First home buyers given new financial year gift
Property market gets $1.5bn boost
Government extends $150k asset scheme Property
Property investors receive encouraging news
Rental vacancies fell between April and May, despite fears cash-strapped tenants would abandon rental properties due to COVID.
Across Australia, the vacancy rate decreased from 2.6% in April to 2.5% in May, according to SQM Research.
Looking at the different capitals, vacancy rates fell in Brisbane, Perth, Darwin and Hobart, were flat in Adelaide, and rose in Sydney, Melbourne and Canberra.
One cause for concern, though, is CBD vacancy rates, which are very high.
First home buyers given new financial year gift
Good news: On July 1, another 10,000 spots will be made available in the popular First Home Loan Deposit Scheme.
The 27 participating lenders have begun announcing the number of spots they’ve been allocated – and these spots are likely to go fast.
The First Home Loan Deposit Scheme allows eligible buyers to enter the market with just a 5% deposit without having to pay lender’s mortgage insurance (LMI).
To reserve a place in the scheme there have been two important changes
Before applying, you must receive conditional approval from your lender
You will need to provide documents that verify you are:
An Australian citizen, aged 18 or above
A first home buyer
Married/de facto (if applying as a couple)
There's also some complexity around filing your tax return quickly if you apply for the scheme after July 1st 2020. Please get in touch if you want to understand how it works.
Property market gets $1.5bn boost
Homeowners and property investors are smiling after the government announced $1.5 billion of new, ready-to-go infrastructure spending.
The government has allocated $1 billion to 15 "priority projects which are shovel-ready" and $500 million to road safety works.
Traditionally, long-term infrastructure projects attract workers from other states, which often leads to an increase in demand for housing, and therefore property prices. So these projects could be of interest to anyone looking to purchase or invest.
The infrastructure priority list includes:
Inland rail from Melbourne to Brisbane
Marinus Link between Tasmania and Victoria
Olympic Dam extension in South Australia
Emergency town water projects in New South Wales
Road, rail and iron ore projects in Western Australia
The $1.5 billion package will support over 66,000 direct and indirect jobs, according to the Prime Minister.
Government extends $150k asset scheme
The enhanced instant asset write-off scheme, which was due to expire on June 30, has now been extended to December 31.
The scheme lets eligible businesses immediately write off assets they buy for less than $150,000.
The threshold applies on a per-asset basis, so your business can use it an unlimited number of times, provided each asset costs less than $150,000.
Businesses must have an annual turnover of less than $500 million to participate
Assets can be new or second-hand
If your asset is for business and private use, you can only claim the business portion
In March, the government boosted the asset threshold from $30,000 to $150,000.
If you’re looking to take advantage of this opportunity and need help funding your purchases, we can help.
Disclaimer: The advice provided in this article is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. We encourage you to consult a finance professional before acting on any advice provided in this article or on this website.
