The tax changes in NSW budget designed to boost housing
A mixture of measures to fast-track new parks and schools plus extended tax breaks for developers will be part of a budget boost for the NSW build-to-rent sector, as the state plays catch-up on the housing crisis.
With NSW lagging other states in the emerging build-to-rent sector, the 50 per cent reduction in assessed land value that lowers tax bills for eligible developments, established by the previous Coalition government in 2020 with a 20-year sunset clause, will be extended indefinitely to support investor confidence.
Anaemic housing supply has plagued the NSW government since it was elected in March 2023, and Premier Chris Minns has embarked on an ambitious suite of rezoning policies to address the state's sluggish planning process.
The budget measures announced on Thursday are intended to help the government pick up the pace as NSW needs to build 378,000 homes by July 2029 under the National Housing Accord, targets hampered by inflationary pressure on construction costs and dampened consumer confidence. Australian Bureau of Statistics data released in late May showed housing approvals in NSW had fallen by 4 per cent compared to the previous 12-month period.
'You can't build new homes without roads, parks, and schools to match, and the community shouldn't have to wait for them,' Minns said in a statement.
'Whether it's new tax incentives, planning reforms or fast-tracking infrastructure, we're focused on making it faster and easier to build the homes and communities NSW needs.'
Among the measures included in the state government's budget on Tuesday, developers will be able to dedicate land for public purposes or deliver infrastructure projects, rather than paying through a housing and productivity contribution.
The government hopes this will improve the feasibility of greenfield developments, as developers will not be required to hand over significant amounts of cash before the issue of the first construction certificate or throughout the development approval process.
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The volatility in employment figures has not been reflected in the jobless rate, which has held within a tight 3.9 to 4.4 per cent range since March 2024. The participation rate fell 0.1 per cent to 67 per cent. "Together, today's numbers imply the labour market is continuing to gradually cool," Mr Sycamore said. The Reserve Bank watches the labour market closely, given it is a key factor in the rate of price growth. Mr Sycamore expects the RBA to lower interest rates by 25 basis points at its next board meeting in July, but the rates market marginally reduced its odds of a July cut to 63 per cent following the release. Treasurer Jim Chalmers said low unemployment was one of the best defences against uncertainty in the global economy. "While other countries have sacrificed much higher unemployment for progress on inflation, Australia has been able to preserve the gains we've made in our labour market at the same time as we've got inflation down and jobs up," he said. 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The volatility in employment figures has not been reflected in the jobless rate, which has held within a tight 3.9 to 4.4 per cent range since March 2024. The participation rate fell 0.1 per cent to 67 per cent. "Together, today's numbers imply the labour market is continuing to gradually cool," Mr Sycamore said. The Reserve Bank watches the labour market closely, given it is a key factor in the rate of price growth. Mr Sycamore expects the RBA to lower interest rates by 25 basis points at its next board meeting in July, but the rates market marginally reduced its odds of a July cut to 63 per cent following the release. Treasurer Jim Chalmers said low unemployment was one of the best defences against uncertainty in the global economy. "While other countries have sacrificed much higher unemployment for progress on inflation, Australia has been able to preserve the gains we've made in our labour market at the same time as we've got inflation down and jobs up," he said. 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