Why real estate needs to be a focus this election

With West Aussies due to hit the ballots for the Western Australian election on Saturday March 13, it’s important the real estate industry becomes a core focus for all parties.

You might be asking why real estate should be a core focus. Housing is one of the most basic human needs and we need to ensure that it remains as affordable as possible for everyone in WA.

Whilst many commentators predicted that property would take a bit of a hit once COVID-19 came about, WA real estate instead proved to be resilient and a key driver for the state’s economy.

This needs to continue, which is why we need bold reforms to help deliver a fair, sustainable and prosperous property market. Throughout the lead up to the election, REIWA will focus on five key points which we believe will help continue to keep our economy on the road to recovery.

For many buying a home, stamp duty adds a considerable amount to the savings needed to qualify for a home loan, pushing homeownership out of reach for some people, which is why REIWA is calling on a state tax review into changing the way stamp duty is paid.

The institute recommends a two-stream revenue collection method that would provide buyers with the choice between paying the upfront cost or an ongoing annual payment, which provides buyers with a more equitable taxation system.

Secondly, a plan needs to be developed to tackle WA’s rental shortage which involves providing short-term initiatives to attract investors back to the market to help boost rental stock, and ensure legislative reforms, such as the upcoming review of the Residential Tenancies Act, provide a fair rental system for tenants and owners.

In addition, there needs to be a focus on aligning WA with the rest of the nation by removing stamp duty on the purchase of a small business. Currently when a business of up to $5 million is purchased, the owner will be liable for approximately $250,000 in stamp duty, which equates to five local full-time jobs in sectors such as retail, hospitality and childcare, or up to 10 trainees.

WA’s retail sector has felt the blow of an economic downturn more than many sectors, which is why an urgent review of the Commercial Tenancies (Retail Shops) Act is required to enable greater flexibility in length and conditions of retail leases, without seeking permission from the State Administrative Tribunal.

Finally, the stamp duty rebate for off-the-plan purchases needs to become a permanent feature of WA’s property tax system, rather than let the legislation expire in October 2021, as it is currently scheduled to do so.