The Albanese Government successfully passed over thirty pieces of legislation in the final sitting parliamentary week of the year. Below is a summary of the legislation that will be of interest to real estate professionals. The two central bills, the Treasury Laws Amendment (Build to Rent) Bill 2024 and the Help to Buy Bill 2023, are driven by institutional and government investment in the housing sector.
Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024 and Capital Works (Build to Rent Misuse Tax) Bill 2024
The changes under this legislation to build-to-rent properties include:
tax concessions for developers to incentivise the construction of build-to-rent developments
setting of eligibility requirements for build-to-rent developments, including at least 10% being affordable tenancies and a minimum of 50 dwellings or more
long-term lease options for tenants with minimum agreements of five years and restrictions on no-fault evictions.
This legislation is expected to produce around 80,000 new build-to-rent dwellings and is considered a win for the sector.
Help to Buy Bill 2023
The key features of the Help to Buy Scheme are:
The federal government will provide equity contributions of up to 40 per cent for new homes and 30 per cent for existing homes
The federal government’s stake in properties means it can recover its share if the property is sold or the owner buys out the government’s equity contribution
Buyers with smaller loans and deposits will incur lower mortgage repayments, further eliminating the need for lender mortgage insurance (LMI)
Homebuyers will require a minimum of 2 per cent deposit for participation in the scheme
It is open to singles on $90,000 or less annually and couples on $120,000 or less annually if they are first-home buyers or do not currently own a home
Anti-Money Laundering and Counter-Terrorism Financing (AML-CTF) Amendment Bill 2024
The AML-CTF legislation has passed and will expand compliance around monitoring money laundering and counter-terrorism financing for real estate professionals, among other entities. Entities must maintain an AML/CTF program with customer due diligence (CCD), reporting, and recordkeeping requirements. The legislation has three central objectives:
Expanding the AML/CTF regime to additional high-risk services provided by tranche two entities.
Modernising the regulation of digital currency and virtual asset and payment technology.
Simplifying and clarifying the AML/CTF regime to increase flexibility, reduce regulatory impacts, and support businesses in preventing and detecting financial crimes.
Treasury Laws Amendment (Reserve Bank Reforms) Bill 2023
The Reserve Bank of Australia legislation, as recommended in 2023’s RBA review, was passed, introducing several changes to Australia’s central bank. The most significant change for the membership is the splitting of the existing RBA Board into a monetary policy board focusing on interest rates and monetary policy and a governance board focusing on the bank’s operations and administrative goals. It is possible that this will impact the direction of Australia’s interest rates and property market going forward.