Crowd money: is this the brand new frontier of home investing?

A new tax is being advocated by The Grattan Initiate - and also I’m telling you today, you’re not likely to like it!

The particular Grattan Institute, that is an independent feel tank dedicated to developing quality public plan solutions with regard to Australia’s future, will be proposing a brand new tax on property owners.

Directed at raising $7 billion a year, the home ‘levy’ they are suggesting for will be charged at 0.2%, or $2 per $1,000, on the unimproved price of every home in Australia.

It could be attached to your own council rates valuation, and thus would basically be payable on your terrain value.

It’s estimated that the once-a-year charge will be around $772 around the median-priced Sydney residence, $560 on the median-priced Melbourne home, and much less in other cities and regional places.

You can’t say I didn’t alert you; We said a person wouldn’t like this information!

Note that this can be by no means a sure factor; it’s not even formally on the table. It's simply been proposed from the Grattan Institute, however they have suggested a number of tax initiatives related to property through the years that have in no way come to being.

And on a positive note, their own working document argues the levy might be used to finance the reduction and eventual abolition of stamps duties, that they can describe as getting “the most inefficient and inequitable condition taxes”.

No-one likes the thought of a new property tax. It’s tough enough as an investor these days to create a 20% home deposit, let alone add extra fees and costs towards the equation. But if this is a measure that makes way for seal of approval duty to be eliminated, i then think that’s relocating we can probably get behind?

To you: what can you prefer? A tiny property garnishment charged every year? Or is a substantial upfront expense in the form of stamp duty a less strenuous way for you to manage your property trading budget?

Til next time, pleased investing!

The fastest-growing household size, according to a new report, is single-person households. Click here to know more about Real Wealth Australia.

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