Essence Project Management’s Post

The Build-To-Rent (BTR) sector celebrates positive news overnight with the finalisation of the Treasury Laws Amendment (Build to Rent) Bill 2024 in Federal Parliament. The amendments focus on providing key incentives for investors to support the construction of new BTR developments: 𝗕𝗧𝗥 𝗜𝗻𝗰𝗲𝗻𝘁𝗶𝘃𝗲𝘀 𝟭. 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗪𝗼𝗿𝗸𝘀 𝗗𝗲𝗱𝘂𝗰𝘁𝗶𝗼𝗻 𝗥𝗮𝘁𝗲 ▪️Increases from 2.5% to 4% p.a. for eligible BTR properties, enabling higher annual deductions on construction costs, reducing taxable income, and encouraging investment in new rental housing. 𝟮. 𝗙𝗶𝗻𝗮𝗹 𝗪𝗶𝘁𝗵𝗵𝗼𝗹𝗱𝗶𝗻𝗴 𝗧𝗮𝘅 𝗥𝗮𝘁𝗲 ▪️Reduces the final withholding tax rate on eligible fund payments from Managed Investment Trusts (MITs) to overseas investors from 30% to 15%, making Australian BTR projects more attractive to international investors and potentially increasing overseas capital flow. 𝟯. 𝗘𝗹𝗶𝗴𝗶𝗯𝗶𝗹𝗶𝘁𝘆 𝗖𝗿𝗶𝘁𝗲𝗿𝗶𝗮 ▪️To qualify, developments must meet specific criteria, including: • A minimum 10-year hold as BTR • At least 50 units per development • Single-entity professional management 𝟰. 𝗢𝗯𝗷𝗲𝗰𝘁𝗶𝘃𝗲 ▪️ The bill’s primary goal is to address the housing shortage by increasing the supply of rental properties. By making it more financially attractive for investors to develop and maintain rental housing, it aims to provide more affordable and stable rental options for tenants. Many in the sector will be toasting the success of years of tireless lobbying to remove investment barriers. We look forward to supporting current and future clients in leveraging these incentives to increase the availability and quality of rental housing across Australia. #Essence #BuildToRent #BTRIncentives #HousingInvestment #PropertyDevelopment #RentalHousing #AffordableHousing #TaxIncentives #AustralianProperty #BTRSector