The State Government’s stamp duty reform for off-the-plan CBD apartments and the extension of the First Home Bonus Grant are bright points in a Budget shaped for gloomy times, the Property Council says.
Combined with no additional tax burden for the property sector, the Budget balanced financial rectitude with a stimulatory bonus, SA Division Executive Director Nathan Paine said. “Nobody expected this to be a pain-free Budget, but overall the property sector came out relatively unscathed,” Mr Paine said.
“And one of the lynchpin components of the 30-Year Plan for Greater Adelaide – a populous CBD – has been given a real boost by the stamp duty reforms.”
The Property Council applauded the weekend’s announcement on stamp duty, saying that by eliminating an inherent disadvantage the reform put apartments on a level playing field with house-and-land packages, which will unleash demand for inner-city living. While the concession would ideally have been applied across the metropolitan area, tight economic times clearly made that impossible. But combined with the stimulatory effects of the First Home Bonus Grant would see more consumers enter the market, meaning more work for the construction sector.
However, the suspension of major public transport infrastructure projects in the forward estimates risked dampening enthusiasm for urban renewal outside the CBD.
“We have always considered the Government’s commitment to public transport as going hand-in-glove with the land use component of the 30-Year Plan for Greater Adelaide, so having electrification and other projects on the never-never is a worry,” Mr Paine said.
“There’s no doubt the Treasurer has been between a rock and a hard place – he’s overseeing one of the biggest infrastructure investments in the state’s history, in some of the toughest times imaginable,” Mr Paine said.
“Clearly something had to go in order for other projects to continue, but this decision regrettably slows the momentum of urban renewal outside of the CBD.
“This highlights the need for the South Australian Government to urgently look at alternative financing models for infrastructure investment.
“Growth Area Bonds and similar approaches to infrastructure funding allow governments to fund projects off the balance sheet, recouping expenditure from the taxable value of development catalysed by the investment. The Premier has firmly placed this matter on the CoAG Agenda and we look forward to seeing its activation in the near future.
“It’s not too late to engage these models to get public transport investment back on track, and we’d be more than happy to work with Government to find the right approach.”