NRAS

https://www.afr.com/real-estate/aff...s-to-lose-belowmarket-subsidy-20181217-h196sx

title is here, (apology)

Affordable rental: 37,000 NRAS units to lose below-market subsidy

 

The NRAS subsidies were for a limited time anyway. (Cant read AFR)

 

Link behind pay wall .

Cliff

 

With AFR: Just copy the title and paste in google and it'll bypass the paywall.

 

updated

 

Still didn't work .

My issue with NRAS is it's a " scheme " that distorts the market place and over the years I haven't seen too many of those end up well .

Cliff

 

Hi Cliff,

I am into 4th NRAS year for 3 of my properties. From my perspective, its wonderful investment. You cant find any property investment which gives you appx 7k post tax per year on appx 380k investment for 10 years. In fact, NRAS has saved my development in falling market as without it, it would have been difficult/impossible for me to hold them.

With regards,
Rooky

 

Read the article - it really is not news.

I can't think of any NRAS owner who would decide to keep rents at 20% below after the benefits from the govt stop. So yes there will be less affordable rental options out there.

I don't see that investors will be selling them in droves due to no longer being CF+ as they should have increased in value over the 10yrs if they purchased well and will be able to pay for themselves due to increased yields during that time.

That really is one of the most obvious and overly dramatic articles by AFR. A current affair style

 

I agree....NRAS distorts the market.... I don't think it is a good a product as it is made out to be.

Keep it simple...should be the motto.

As for labor getting 250,000 more homes good luck........even if they had the funding...the issue would be labor and how quickly councils would push things through. Wishful thinking.

My personal opinion...they should let market forces work. APRA did its job..they now need to let is work....a fine tuning of the policy will bring things back to equilibrium. Its when govt's meddle all goes to ******....

 

Still early days from my perspective .

Cliff

 

What... a policy announcement with zero nuts and bolts about a new subsidy just like the old subsidy announced well before Labour has possibly even won a future election is early days? I was thinking we should all rush out and submit our DA's and get building on the back of this!!!

 

The only issue I have with NRAS is they were usually sold at a premium for a cookie cutter house This will have a measurable impact on long term CG and the consolation is the NRAS benefit after loss in market rent and paying above average PM fees.

Not my cup of tea unless I am the one selling NRAS stock

 

So why doesn't Australia just copy Singapore's model?
IS THE SINGAPORE HOUSING MODEL RIGHT FOR NEW YORK CITY? - PlaNYourCity

 

I have asked people about their opinion of the housing market when in Singapore and they seem to like it (the ones I asked) Its a very different and cool model (if you are into social engineering and public housing models that appear to actually work) but they are a small wealthy port town approximately the size of Townsville centrally located to the most populated part of the planet.

Australia's landmass, cost base, living conditions, housing stock type, lifestyle and economy are so different on so many levels my eyes water. It would be a really big change for us. Really big.

 

Exactly my thinking .

Cliff

 

You mean politicians will actually have to follow a plan through and apply it properly instead of cherry picking random parts and wondering why it fails....

When you think about comments from shorten about making housing more affordable for FHOB, this is a policy that could actually work.

Nucleus family, certain income limits, paying back a portion back to government on resale value... doesn't sound too bad realistically. Instead of selling all land to developers, earmark a portion for "affordable housing" and make a requirement for developers to build a certain %. Much like an extension of the current Affordable housing where if you allocate a certain % you get an increase in FSR.

 

Correct. The article is rubbish. All NRAS has always had a maximum 10 year eligibility and the funding always expired on June 30,2026. That's not 9 years away.... the article was written on 17 December 2018. There is a maximum of @7.5 years available to those NRAS owners who have a property that started its 10 year eligibility on July 1 ,2017 - which is the absolute latest possuble date available to claim a full 10 years.

People get almost everything about NRAS wrong. It's so very simple, and they make themselves look so very stupid. If you do these 3 very simple things;
1. rent it at 20% below market.
2. rent it to an eligible tenant
3. tenant it for at least 274 days of the NRAS year ( May 1 - April 30) - you are allowed 91 days vacancy ( 13 weeks ) before the incentive starts being reudced, and it is forfeited after 182 days ( 26 weeks) of vacancy

Then you get the tax credits S. I. M. P. L. E

It's not social housing
Its not mandatory . You can choose to stop participating the property in the NRAS at any time
There is ZERO evidence it does anything to property prices
There is ZERO evidence it creates slums

Truly, truly amazing that the usual suspects are trotting out the usual BS again.

 

Where is your evidence to support this argument?

There was plenty of that going on - yes. But that was because marketers have always sold house and land at inflated prices. ie it was going on long before NRAS and its been going on since NRAS wound up. So it's just not reasonable to infer that NRAS itself was the problem. Are we really to believe that the practice of marketers gouging new house and land deals only started when NRAS existed, and it ceased when NRAS wound up? Come on guys...

 

Agreed that it's not a problem specific to NRAS but very rampant in NRAS property sales. You seem like an exception but the vast majority of NRAS property sales I came across are simply not worth it.

 

If it’s done well , it works well.