National rental affordability Scheme round two call for applications
The National Rental Affordability Scheme (NRAS) round two call for applications opens today, with the aim of making more affordable rental homes available sooner for low and moderate income renters.
NRAS is a key component of the Rudd Government’s $3.7 billion housing package, which will boost rental stocks, help people save for their first home and lower housing infrastructure costs for some entry level housing.
Under the scheme, the Australian Government has combined with State and Territory Governments to offer incentives to institutional investors and housing providers to build properties which will be rented out at 20 per cent below market rate.
Round two has been structured to maximise affordable rental housing outcomes both in 2008/09 and from 1 July 2009 onwards:
- Proposals for 20 or more dwellings, available for rent before 1 July 2009, will be assessed as they are received; and
- Proposals for dwellings available for rent from 1 July 2009 will be assessed after round two closes, on 27 March 2009.
“The first round of NRAS will deliver up to 3950 more affordable rental homes and the first properties are likely to be available for rent before the end of the year,” , Tanya Plibersek said.
“This program will assist large scale investors to diversify their portfolios through investment in affordable housing. Not only is this is a new asset class for investors, but a great opportunity for community housing providers to expand their operations.”
The NRAS Incentive is at least $8,000 a year, which is tax free and indexed to the rental component of Consumer Price Index. The Australian Government contributes a $6,000 incentive and the State or Territory where the home is contributes $2,000.
NRAS will help build up to 50,000 new rental properties across Australia at a cost of $623 million in the first four years. If market demand remains strong, incentives for a further 50,000 affordable rental dwellings will be made available over five years from July 2012.
“NRAS will make renting more affordable in two ways – by reducing rent and increasing the supply of rental dwellings across Australia,” Ms Plibersek said.
“There are 1.5 million households eligible to be tenants, including seniors and key workers and their families.”
Information sessions for investors will be held around the country from late January.
For more information on NRAS or the information sessions go to National Rental Affordability Scheme (NRAS) or call 1800 334 505.