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Non-users may have to pay for vacant properties

Discussion in 'Property Market Economics' started by Bargain Hunter, 18th Aug, 2015.

  1. Bargain Hunter

    Bargain Hunter Well-Known Member

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    Most people have come to accept the user pays philosophy, be it toll roads to taxes on so called luxury goods.

    But how do you feel about paying extra council rates for having a property vacant for extended periods, this is a plan that the Federation of Housing Associations are recommending to address housing affordability.

    According to their CEO, Wendy Hayhurst, there are around 120,000 properties in the Greater Sydney Region which fit the above criteria.

    Read more here: http://www.smh.com.au/nsw/vacant-sydney-homes-in-sights-for-housing-tax-plan-20150814-gizem2
     
  2. Coota9

    Coota9 Well-Known Member Premium Member

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    Is this aimed at everyone or targeting foreign investors that leave properties empty?
     
  3. Azazel

    Azazel Well-Known Member

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    Hmm, that's an interesting idea.
    I wouldn't like it if it happened to myself, but I guess it has it's merits.
    What about little holiday houses?
     
  4. Coota9

    Coota9 Well-Known Member Premium Member

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    Non income producing properties exempted maybe..
     
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  5. MGF

    MGF Well-Known Member

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    Kinda absurd from a enforcement view.

    Automatic water timers. Automatic electricity switches. Now your house uses water and power as though someone was living there. Can't be identified through either record.

    Then what? Targeting houses empty on census night?
     
  6. liverpool77

    liverpool77 Active Member

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    they do this with rates in England....
     
  7. Bargain Hunter

    Bargain Hunter Well-Known Member

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    Anyone that leaves properties empty for extended times, the actual time is to be determined.
     
  8. Bargain Hunter

    Bargain Hunter Well-Known Member

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    Potentially holiday homes could get hit if this were to go ahead.
     
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  9. Azazel

    Azazel Well-Known Member

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    I wonder how some people afford to hold holiday homes. Maybe they bought them when they were really cheap. Maybe they inherited them.
    This plus insurance plus rates and no rent would make it more difficult to hold onto and keep vacant.
     
  10. Bayview

    Bayview Well-Known Member

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    It could really put the brakes on that sector of the market.

    A lot of folks buy holiday homes, and they are usually buying someone elses' holiday home, so if all the new buyers pull out due to the extra charges looming, this leaves the sellers with no buyers.

    Cheap homes for the FHB's...with a massive commute. ;)
     
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  11. Scott No Mates

    Scott No Mates Well-Known Member

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    If you've got the money you don't worry about it.
     
  12. bumskins

    bumskins Well-Known Member

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    I think its fair enough from the point of view that council/government/utilities, etc make planning and investment decisions around housing. Leaving it empty is inefficient and so there's probably some merit for being penalised.
    Also if the place is to remain uninhabited for a long duration I'd be a fan of cutting and capping the services away. Nothing worse than having a fire or some sort of other safety issue inside a place that is not even being used.
     
  13. bumskins

    bumskins Well-Known Member

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    I wouldn't think the charges would be so high as to have that much of an effect. Could be wrong.
     
  14. 2FAST4U

    2FAST4U Well-Known Member

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    I don't work in the real estate industry but from reading forums and media etc. there seems to be this perception that investors (particularly foreigners) are purchasing houses and just leaving them vacant instead of renting them out. If this is the case it’s choking supply so it’s logical for there to be some market incentives for the owners to rent the properties. 120,000 properties throughout Greater Sydney are apparently vacant. Population growth in Sydney is currently around 90k per annum while the ABS suggests that each household has an average of 2.7 residents. Therefore, there’s around 3 years of housing supply just laying vacant unutilised. To me it makes a lot more sense for the Government to crack down on vacant properties than release more land supply. Tax the vacant properties and if investors don't want to be taxed with a surcharge they can always rent them out. If they leave them vacant the Government should tax them and set away th money in a trust account to be used for building more public housing.
     
  15. Emoi

    Emoi Well-Known Member

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    Thats a nice simple easy fix
     
  16. Azazel

    Azazel Well-Known Member

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    There you go, fixed the FHB crisis!
     
  17. Azazel

    Azazel Well-Known Member

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    I've got money, I would still worry about it.
     
  18. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

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    This would send @Waldo bankrupt pretty quick
     
  19. barnes

    barnes Well-Known Member

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    Interesting idea. I used to keep a property vacant while living overseas (not all the time though), than I have decided to rent it out, which I still bitterly regret. Now it might mean more taxes? It will be hard to prove that it's empty.
     
  20. Bayview

    Bayview Well-Known Member

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    It's ridiculous, really.

    It shouldn't matter what folks do with a house they buy...in my area there are loads of homes which get used maybe one week per year or even less, others every school hols, etc.

    My wife did a bit of private nursing work for one of the Saudi families when we lived in L.A. This home was easily worth more than $10m....it was a holiday house, and only ever used when they were in L.A.

    Plenty of folks around rich enough to buy a house and leave it vacant for their own use as they wish.

    It's like saying to someone who happens to like buying cars, and drives them once in a blue moon; "You are not driving these cars enough; we are going to charge you an extra premium on your rego".