NRAS granny flat

[spludgey]

Is it possible to have a granny flat built and make it an NRAS property?
To be honest, I don't know a great deal about NRAS, but if this was possible it seems like it would be worthwhile.
If it's possible, do I have to go for certain builders with NRAS qualifications, or can I apply or it myself?

 

[Ausprop]

I believe there are a multitude of reasons why this won't happen, but will leave it for the nras experts

 

[spludgey]

Does anyone know for sure?

I'm still a little hopeful due to the the paragraph below which is part of the National Rental Affordability Scheme Policy Guidelines.

7.6. ‘Granny Flats’
‘Granny flats’ are considered to be small residences which may be attached to, or located on the same block as, another residence. To be eligible under the Scheme, granny flats must meet the Scheme requirements, including that they are able to be lived in as a separate residence and fall under the relevant State, Territory and local government landlord, tenancy, building, health and safety laws. Where it is demonstrated that a granny flat can meet all of the requirements, this type of dwelling may be considered eligible under the Scheme.

 

[atti]

to my knowledge i was about to buy nras property until i notice you cannot manage it or choose who manages your property therefore you have no control over what you own. i dont think you can offer a grannyflat as an nras property unless it is built with an nras builder with all the approvals etc. why would you want a property which rents 20% bellow market value anywayz in first place, the tax incentives just doesnt stack up to me. when i approached nras seller i basically have no choice they kind of hard sell you what ever is avaliable u cannot choose location etc therefore i did not sign the contract although the free lunch was great thanks nras

 

[spludgey]

If the market rent for the granny flat is $300/week, then under NRAS it would be $240/week, but you would get almost $200/week of incentives on top of this, which are tax free. So on that front, it would be a no-brainer.
As for the selling bit, I'm not planning to ever sell my IPs, so I don't mind if they're harder to sell.

But seeing that you say that you can't choose the location, all of this is pretty pointless, seems it might have to just stay a pipe dream.

 

[atti]

you must go to one of their seminar see how "hard sell you regional properties u dont even want." and nras properties isnt cheap compare to equivalent on market thats what i see.

 

[OKFFW]

Seems like you went to the wrong NRAS seminar atti.

But to each their own.

 

[Aaron Sice]

you must go to one of their seminar see how "hard sell you regional properties u dont even want." and nras properties isnt cheap compare to equivalent on market thats what i see.

i agree, what seminar do you go to?

what tax incentives are you talking about? i dont remember there being any, extra over standard depreciation, outgoings etc.

 

[euro73]

you can apply for NRAS allocations to be made for any brand new dwelling that has never been tenanted.

As far as the incentives go - the concept is very simple.

1. You agree to reduce the rent by a minimum 20% off the prevailing market rent, and offer it as "affordable" accommodation.

2. You must rent it to an NRAS eligible tenant. Tenants must meet strict income criteria for the 12 month period prior to taking up tenancy. Without listing all the thresholds, generally speaking, the range is between @46K income limit for single person and up to @109K for cpl +3 kids. There are a number of different thresholds in between.

2. You submit an ATO return as usual, and you are able to claim the usual deductions for interest costs, management fees, insurance, rates, water, etc...

3. You are also paid an additional $10,350 tax free. 75% is added to your ATO refund in the form of a refundable Tax Offset. 25% is deposited into your bank account by the State Govt. Both payments are 100% tax free.

 

[D.T.]

you can apply for NRAS allocations to be made for any brand new dwelling that has never been tenanted.

I understood the incentives part of your post. But whats involved in applying for nras allocation?

 

[euro73]

In a nutshell ;
You need to own or have control of the site for the proposed development. You need a concept at the very least, but preferrably a DA (either pending or approved)
You need to provide a CV on your previous development experience
You need to provide a project overview
You need to show anticipated price points and weekly rentals
You need to demonstrate that the project is financially viable
You need to demonstrate that the project meets particular energy efficiency, public transport, employment hub proximity
You need to demonstrate the project meets Liveable Housing design criteria
You need to be able to deliver the project from July 1 2015 - June 30 2016