Whilst swept away by other decisions made this week, Government legislation to permit taxing of empty homes and also to disallow tax depreciation for existing homes was passed in the Senate. This is fairly important news for both investors, foreign owners and local buyers.
With buying momentum already stopped, the potential impact of these additional tax changes will be watched closely. Both changes will likely assist purchasers, who have been dejectedly watching prices move further and further from their reach.
For current owners, the news may not be quite so welcome, as the stalling Melbourne market risks actually slipping backwards (it’s already happening in Sydney). But since the aim of the changes is to tilt the balance back in favor of local buyers, the impact of the timing with an already slowing market, will likely achieve exactly what the Government was hoping for. So long as it’s limited, it might be a good thing. But sometimes it’s the small things that create the final straw and not many, the Government included, want to see that. Fortunately, this is only a remote chance.