Scott Morrison’s third budget has hit the ground running and is almost wholly about tax. Whilst ambitious in nature, the 2018 budget is a complete failure for first home buyers.
On the contrary, it’s a HUGE win for Airbnb investors.
Property commentator and valuer Anna Porter of Suburbanite welcomes the changes for investors but warns that first home buyers are out of luck and the affordability crisis has not been addressed.
“If you’re a first home buyer looking for some form of relief to housing prices in the 2018 budget you are flat out of luck” says Ms Porter. “There are no real measures to address the affordability crisis facing many first home buyers. In fact, the budget has done quite the opposite.” She continues.
The Government has allocated $1.6 Billion to increase in home care place by 14,000 over 4 years, resulting in our aging population staying at home longer with more support to do so. Porter agrees that “This is a win for our aging population and a much-needed measure, but it certainly won’t encourage our aging population to sell their oversized family homes thus freeing up housing stock.”
The affordability crunch is strongly attributed to a lack of housing supply in comparison to demand. The treasurer’s ambitious plan focus’ on road projects which does not create long-term jobs BUT a 10% GST surcharge is set to be introduced which will shake up the way people book Australian hotels.
“On the property investors side of the fence there are no major measures that will impact investors, even the infrastructure spend is focused on road projects, “which are not long-term job creators so they rarely impact the property market in any sustainable way” warns Anna Porter.
“The big win in the budget for property investors comes through the Airbnb sector, with a move to impose a 10% GST surcharges on bookings made to Australian hotels using offshore agencies, such as Expedia and booking.com” says Ms Porter. This measure is expected to raise $5 million a year in GST revenue, when it starts in July 1, 2019.
“This will not apply to home stay style accommodation such as Airbnb, which may push more people to that platform over the alternatives. There has been much speculation of late that the Government will start to regulate Airbnb and find ways to tap in to the revenue, and whilst this may still happen via other government controls, it certainly hasn’t come through the budget” says Ms Porter.
“They have not only left Airbnb alone, they have made it the platform of choice, by 10%. Airbnb investors are absolutely winning here.” She continues.
The good news just keeps rolling for the Airbnb investors as there has also been a $45 million commitment to improve tourism-related infrastructure likely to reduce the demand for Airbnb properties across Australia.