First National Basso Real Estate Update Nov 2020

First National Basso Real Estate Market November 2020

Update

Melbourne has finally begun to emerge out of lockdown! The sun is shining and the streets are filling again. Melbourne has recorded 0 new cases of COVID-19 in the past days.

In regards to the rental market, our Leasing team have begun to show tenants through properties again, initially on a 1:1 basis but this week restrictions have eased to allow 2 people per inspection. Full COVID-19 safe processes are in play. Open for inspections are not yet permitted and we remain conducting private inspections only. We look forward to fewer restrictions from this weekend.

With the easing of restrictions comes a greater willingness to move houses, and we have experienced an increase in enquires over the past few weeks. 

Our Leasing team is at full capacity; Routine inspections are still not permitted, but we hope these may recommence with the additional relaxation of restrictions due on 8th November. We will provide an update on this when further information is available.

With the easing of restrictions and the ability to now conduct private buyer inspections, our Sales team has seen a steady increase in inquiry levels.  Throughout the COVID-19 pandemic, our Sales team continued to transact and sold properties. We are anticipating a strong final quarter of the year with those who held off buying or selling during restrictions now entering the market.

As always, if you have any questions, please do not hesitate to contact your Property Manager or myself.

Core Logic Update

 

The investment option that can hide unexpected GST

New residential property is a popular investment for many and can be especially so for self-managed superannuation funds, however, the ATO is concerned that not every investor in residential property is fully aware that it is an option that may bring with it unexpected GST obligations.

The ATO says that from 1 July 2018, most purchasers must withhold an amount from the contract price at the date of settlement and pay it directly to the ATO. The sale price is paid to the property supplier.

This applies to:
■ new residential premises
■ land that could be used to build new residential property (“potential  residential land”).
Purchasers who engage a representative when buying new residential property will need to complete a signed declaration so the representative can lodge two  required forms and pay GST on behalf of the purchaser.
Purchasers who have a GST withholding obligation must complete and lodge two forms:
■ when they sign the contract, lodge Form one: GST property settlement withholding notification using information from the supplier notification (see below)
■ when the property settles
● lodge Form two: GST property settlement date confirmation, and
● pay the GST withheld amount.
Ask us if you require these forms.

If there were any mistakes on Form two, the ATO should be contacted to have it cancelled before lodging a new form. If multiple properties are bought, lodging a new form for each property transaction will be required.

SUPPLIER NOTIFICATION
To complete Form one, the supplier (seller/vendor) needs to give the buyer a “supplier notification” so the purchaser knows whether or not there is a GST
withholding obligation.
If there’s an obligation to withhold GST, the supplier notification must include:
■ the name and ABN of all suppliers
■ GST branch number (if applicable)
■ the amount of GST to be withheld (rounded down to the nearest dollar)
■ when the GST must be paid
■ GST-inclusive contract price (plus the GST inclusive market value of non-monetary considerations).

A supplier’s written notice can be relied on:
■ when it states a purchaser isn’t required to pay an
amount to the ATO. In most states and territories the standard contract of sale clearly states if a purchaser is required to withhold GST or not
■ if the purchaser is unaware of an error on the notice
and the supplier doesn’t tell them.

However, if the purchaser or their representative knows that a supplier is registered for GST and selling new residential premises, the ATO considers it unreasonable not to withhold and pay an amount to it at settlement.
The ATO has stated that it won’t retrospectively penalise purchasers who acted reasonably if it’s later found that a supplier hasn’t met their obligations.

 

If you are interested in the area or would like to know more about living on the Mornington Peninsula. Please feel free to contact our office Click Here for Details.

If you are interested in the Real Estate Market and want to find out the prices of recently sold properties, you can download our FREE report HERE.

You can also review our current listings
Click Here

What is my home worth?

Simply fill in the required information to discover what your property is worth

Find Out Now

Paul Basso

Author Paul Basso

Established in 2000, First National Basso is a business based on transparency, honesty, personal service and trust. With a commitment to innovation, First National Basso has continually evolved and grown to become one of the longest running and most trusted real estate teams on the Mornington Peninsula.

More posts by Paul Basso

Leave a Reply