|
Living
it up on land girt by tax swells - 12th April 2004
(Credit:
The Sydney Morning Herald)
If
you own a tiny holiday unit on the coast, you could
find yourself paying land tax for the first time when
the new property tax rules begin on June 1.
But
if you own a grand beachfront holiday house, you can
expect to save thousands a year on land tax.
Under
the new rules, owners of investment and holiday properties
where the land is valued at less than $317,000 will
no longer be exempt from the annual tax. But those
with properties on land worth more than $410,000 will
find they pay less because of changes to the rate
at which the tax is calculated.
If
you own a holiday house on a typical block in Byron
Bay Shire, where the average valuation is $572,509,
your bill will be reduced by more than $1100 a year
- from $4342 to $3215.
But
the land tax activist David Singer warned that the
savings could be clawed back by the Government if
the valuer-general increased land valuations in the
coming year.
"They
only have to increase the land value of a property
by 15 per cent to get exactly the same amount as they're
getting now," he said.
Until
that happens, owners of holiday homes within striking
distance of Sydney are also likely to benefit from
the changes because most are expensive enough to benefit
from the rate changes.
In
Kiama, 120 kilometres south, local councillor and
real estate agent Warren Steel points out that the
cheapest land package on his books is $395,000. The
cheapest home is $420,000 and the cheapest townhouses
are $329,000 and $339,000.
In
fact, it is now hard to find a home with a view anywhere
in Kiama which is worth less than $1 million.
Look
even further down the coast and the pattern remains
the same.
At
Bermagui, about as far south and isolated as any Sydney
holiday home purchaser could want, Rikkie Seymour
of Bermagui Real Estate says a waterfront home was
sold recently for $1.2 million, two ocean-view properties
are for sale at $550,000, and the cheapest house on
the books is a small two-bedroom property with no
ocean views for $260,000.
While
the continuing land tax bill will be reduced, holiday
home owners will have to pay a one-off exit levy of
2.25 per cent when they sell, provided they are selling
for at least 12 per cent more than they paid. That
means a $22,500 bill when selling a million-dollar
beach house.
Links:
The
Sydney Morning Herald
Articles
Sydney-siders
head north, by Greg Tingle
|
