ACT Canberra rates and land tax hikes

It's a good buy.

We're seeing $1m+ purchases now - and I'm not surprised. The location is one of the best in the Inner North and will only get better with the eventual rejuvenation of Dickson and the local Downer shops. The lightrail will be close as well.

Cheers

Jamie

 

Well I have just being assessing this and with the current increases now a 2 Bedroom unit in Kingston costs $4750 pa in Rates and Land Tax! This last increase being about $1,700 and we are talking about an apartment not a house. Rents will increase but rents are lower now than 5 years ago, so you can never recover these levels of tax increases. Equivalent unit rates and land tax in Melbourne is about $1500pa. Because I cannot negative gear, I will be forced to sell. Not all landlords are rich and negative gear like media would have us believe.
As Matthew said, it is a shame but Canberra is just too expensive to invest in.

 

Good post Christine. I own 3 apartments in Canberra and luckily i can negatively gear. The ACT govt are revenue raising millions from investors to pay for the light rail and they think it won't cost them any votes because it's just investors they are charging. But they are really smashing those who rent over the next few years because i really think there will be many investors like yourself who will sell and less investors who will buy in the ACT due to the high costs and this will only push up rents at a steady rate. BC rates in Canberra are high as well due to insurance and strata managers fees which is pushing it to around $7-7.5k/annum for an investor to hold a 2 bedroom apartment. This is now 2-3k more per annum than an equivalent apartment in another State.

 

Thanks for the information Todd I did not know it had anything to do with the light rail. You are correct, the ACT BC fees are so expensive and this one has increased to over $7k pa (+ $4,750 in Rates & Land Tax). I get to directly compare to my daugher's Melbourne 2 Bed unit which is rented BC about $3000 (+ $1900 in Rates & Land Tax). Equivalent apartments in capital value and age - huge difference. I just wondered whether anyone in the government have really looked at the negative unit property impacts forcing young ones out, but then that is life.

 

Legalised theft. Disgusting.

 

Yeah not sure if the light rail is just an excuse..but even so that will go on for the next 30 years by the time they get to belco etc..extreme taxes along with their extreme increases are here to stay unfortunately and we just have to cop it sweet or sell up, as they can do as they please.

 

Gotta ask my tenant to vote for the other guys. I'm out of pocket $8k in rates, land tax and strata on a unit that only brings in $20k rent...

 

So it's finally dawning on people how the hikes in rates and land taxes are going to e̶f̶f̶e̶c̶t̶ hurt property owners.

Still can't believe there hasn't been more public objection to this. Queanbeyan residents are crying foul over much smaller rate increases this year.

Hardship applications on the rise as Canberrans feel the pinch of rate hikes
Hardship applications on the rise as Canberrans feel the pinch of rate hikes

 

More people lodging objections to rate assessments. Wonder what could happen if vast numbers of Canberrans would object....

Rates sting for Mr Fluffy block buyers
Rates sting for Mr Fluffy block buyers

 

We are selling our only unit in Canberra. It went from a nice cash cow to an expensive liability in just the rate and land tax hikes. I still can't believe it went up over $1000 in one year just because they wanted to put a minimum amount on each unit irrespective of the ovetall lanf size. We have a lot of units on a small block and they obviously obviously wanted much more than the fair calculation.

 

I'm also selling a Canberra IP, partly motivated by this increase in rates and land tax.

Today's Canberra Times has good coverage.

 

And I'm happy to report my Canberra PPOR/IP has now sold. Very happy with the work of Independent Property Group. Listing to exchange in @ 5 weeks .

Now in the next 4 weeks I need to find a good interior painter for my city apartment. I've booked the removals and the electrician, still getting quotes for flooring and the tenant in my city apartment is being a PITA.

 

Our rates went up $80 a quarter this year. The rates notices here are very light on information as to what the money is used for. Don’t see any benefit to our local area that’s for sure. This is our PPOR. We bought it with the view that it would be a good investment and could be easily turned into a dual occ down the track if we move out. Given the ongoing costs to Investers here and the capital gain we have already experienced it may be better just to sell if we move.

@Martin73 congratulations on the sale! Hope you find a painter in time. Tradies can have a bit of a wait here for the good ones.