backed incentive whereby the owners
of approved NRAS properties receive
a tax-free incentive of approximately
$10,000 per annum per property for
10 years. The proviso is that the
property is offered and leased in the
open market at a rental rate that is at
least 20% below the market rent for
the 10-year period.
supplying the product delivery, the
initial applicant reporting requirements
and the ongoing management of the
NRAS tenants and assets is extensive,
laborious and generally outside the
normal scope of reporting developers
are used to.
the space and it is these groups holding
in order to get solid traction behind
NRAS, which is now seen as a major
driver, boosting demand for the low
to mid-priced housing sector.
eagerly awaiting the announcement
and call for applications for Round
5. It is expected the announcement
will come out around 1 April 2013
for some 10,000 entitlements across
Australia. The activity around NRAS in
the development sector suggests there
will a rush of applications upwards
of 150,000 so there will be many
disappointed applicants.
incentives as a $40 billion boost to the
development sector. When you look
at the NRAS offering and consider it
in light of what looks like a stable and
improving residential-development
sector, and other standing incentives
such as Stamp Duty concessions, First
Home Buyers initiatives and the like,
you can understandably feel confident
about a robust residential development
sector through to at least 2016.
manner of the initial introduction and
launch was unfortunate. The scheme
did not get the support of the `big-end
institutional developer', and a good
percentage of the traditional-developer
sector was slow to understand and
take advantage of the scheme.
global financial crisis, which continues
to plague the property development
sector. For instance, we have a sleeping
major-bank sector with regards to
finance sources are expensive, and
there is low confidence and consumer
sentiment globally all factors
dampening activity in recent years.
in the private sector was the common
misconception that NRAS is an asset
class targeting the social-housing sector.
rental housing for low to middle-income
earners, blue-collar workers, service
personnel, teachers, nurses, police and
government-sector employees right
across the service industry.
have begun with vigour. Optimism is
way up and the general activity and
competition in the site-acquisition
sector generally is sending positive
signs throughout the market. NRAS
entitlements are seen as a valuable
tool in the marketing and sale of
their properties.
real estate would find it hard to come
across an asset class that can compete
with the NRAS model it delivers
enhanced cash returns, a level of
rental certainty and security, and
that annual incentive boost from the
Federal and State governments.
that approximately 11,300 dwellings
have been delivered and are rented
or available for rent, with another
28,500 under construction or awaiting
approval. Round 5 at around 10,000
entitlements closes out to the 50,000
targeted, however the jury is out on
application figures, announced
on 3 October 2011:
of Families, Housing, Community
Services and Indigenous Affairs