The Government WANTS You To Get Richer Through Real Estate?

The Government WANTS You To
Get Richer Through Real Estate?

You might think the government wants to stop us from making money from real estate. 

After all, housing affordability is such a hot topic. 

However, the truth is the governments wants house prices to go higher. 

Why The Government Needs Higher House Prices

It seems hard to believe, but the government need house prices to keep rising.

And any time it looks like they might fall, they’ll pull a few strings to keep them going up. 

There are few reasons why. 

  • Governments are there to win elections, and falling house prices is hardly a vote winner.
  • Construction is one of our nation’s economic powerhouses. 


Houses only get built if there’s money to be made. 

And if prices weren’t going up, people wouldn’t build and the construction industry would grind to a halt. 

Suddenly, instead of collecting billions in taxes from tradies, we’d be handing out a fortune in welfare payments. 

  • We’re in the middle of a housing crisis. Years of inaction and incompetence from all levels of government have left us with a housing shortage of catastrophic proportions. 

And the only answer is to build more, which means getting investors involved. (Speaking of the housing crisis, see the above point about votes).

  • Rising house prices injects cash into the economy. 


When prices go up, homeowners and investors borrow against the new value of their property to buy ‘stuff’. 

Holidays, new cars, renovations and extensions. People borrowing against their real estate frees up billions of dollars in much needed cash which pours back into the economy. 

Of course, I’m sure the fact that 7 out of 10 federal politicians invest in real estate has nothing to do with it. 

Cynical? Perhaps. 

Problem is, it’s a Catch-22.

How do you keep house prices rising … without making houses unaffordable?

This is the big difficulty. 

If house prices go up, they become unaffordable. 

And if they’re unaffordable, they stop going up. 

So to make sure house prices keep going up, but remain affordable the federal government has some very attractive incentives for investors (and some for owner-occupiers) to keep us in the market. 

After all, investors are responsible for over one third of Australian houses.

And keeping investors motivated means plenty of new housing supply. 

Here are some of the most attractive incentives on offer. 

Negative Gearing

Negative gearing means instead of paying tax on every cent of rental income, you only pay tax on what’s left after you deduct your expenses. 

Your expenses include interest on your investment loan, insurance, council rates, maintenance, property management fees and any other costs. 

And if it turns out that your expenses are more than your income, you can get a tax refund. That’s the ‘negative’ in negative gearing. 

It can get you into an investment property for a very small ongoing regular investment, often under $100 a week. 

And in case you can’t see how your expenses could be higher than your income, there’s another tasty incentive called …

Depreciation

Depreciation lets you deduct the items in your investment property, including the house itself over the lifetime of each item. 

It’s best explained with an example. 

Carpet, for example has an effective life of 8 years. 

If your investment property is brand new, you can claim back the cost of the carpet (let’s say it’s worth $6,000) over 8 years. 

This allows you to reduce your taxable income by $750 a year for the 8 year life of the carpet. 

Different items are deducted at different rates, so the newer the property the more you can claim back. And in the first few years it can be thousands and thousands of dollars you can use to help reduce your tax bill. 

Capital Gains Tax Concessions

If you have owned an investment property for over 12 months, when you sell it you don’t pay the full amount of tax. 

You only pay tax on half of the gain. 

This means if you made a profit of $300,000 when you sell an investment property, you only include $150,000 as taxable income. 

In other words, you only pay tax on half the profit. 

And you don’t pay any tax whatsoever on your own home. 

State Based Incentives

Each state government is different (which is crazy) so you need to look up exactly what’s on offer where you live. 

However, the state based incentives are hugely attractive. And these really help owner occupiers, especially first home owners get into the market. 

These include:

  • First home owner grants
  • Building grants
  • Stamp duty concessions
  • Co-ownership schemes
  • Land tax discounts
  • Incentives to invest in regional areas

You’d be amazed at the incentives you can tap into, and how much faster they can get you into the market. 

There are so many, you’re best to look online to see what you’re eligible for, or to book a time with us by clicking the button at the bottom, and we’ll take you through them. 

National Rental Affordability Scheme (NRAS)

NRAS is a scheme where investors who create rental housing aimed at low to moderate income earners can claim a sizeable tax offset. 

This tax offset can be worth over $11,000 and is there to encourage people to build more housing for lower earners to rent. 

While NRAS isn’t currently taking on new investors, it’s likely it will return in some shape or form in the future. 

Investing in Your Superannuation Fund

Did you know you can invest in real estate using your superannuation money?

It’s not the easiest way to invest, but it’s certainly do-able. 

And if you have enough money in there, it can be a great way to invest and have an asset growing in there for you. 

This means you can invest this way … without affecting your ability to invest outside your super fund. 

Now, there are a few things you should know. 

There are extra costs including some extra legal structures to set up. Plus the cost of setting up a Self-Managed Superannuation Fund (SMSF) in the first place. 

You’ll probably pay a higher interest rate too because banks don’t really like lending to super funds. Only a few banks will lend you money and you’ll need at least a 20% deposit in your SMSF to get started.  

You also need to make sure your SMSF has enough cashflow to fund the purchase and all ongoing costs, plus there are a lot more rules and regulations, even ongoing compliance to take care of. 

Now, this sounds like a bit of a hard task. 

But think about it this way. 

If you can invest in your super fund, it doesn’t affect your ability to invest outside your super fund. 

It’s like a free hit if you can do it. 

Plus your super fund only pays a flat 15% tax on rental income (after your expenses), and only 10% capital gains tax when you sell it.

And once you retire, you pay no tax on the rental income. 

So while you should talk with your financial planner first, investing in a SMSF can be another great way to grow your wealth.

Green Energy Concessions

Finally, here’s a nice little bonus. 

You can claim rebates for installing solar power in a rental property of up to $1,400.

And you can get an interest free loan for another $1,400 to set it up. 

See How Hard The Government Is Trying To Encourage Investors?

There’s no doubt the government needs investors. 

Their inaction has led to a chronic housing shortage.

And without people like us, it will only get worse. 

Plus, they need the economic benefits of a healthy construction industry, and of course let’s not forget about votes. 

Curious About What You Can Claim?

The amount you can potentially claim is quite extraordinary. 

It could be more than enough to get you into the market. 

But most would-be investors don’t know what’s on offer. 

We’re running a number of calls with people like you to show you how much you can claim. 

And how this could get you into the market sooner. 

There’s no cost for these calls, but they are limited. 

Fill out the form below to request a free consult.

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