NRAS Properties

by

Erik Barrow

The National Rental Affordability Scheme (NRAS) is an Australian Government initiative to stimulate the supply of 50,000 new affordable rental dwellings. Successful NRAS applicants in Victoria are eligible to receive an Incentive for each approved dwelling where they are rented to eligible low and moderate income households at a rate that is at least 20 per cent below the prevailing market rate. The NRAS scheme in Victoria is a Federal and State Government backed incentive scheme launched in 2008 which is designed to:

Encourage investors to develop additional new houses for the rental market.

Provide an affordable rent program for average Australian wage earners as individuals, couples and families. It is not social housing.

Yield higher than usual returns for investors in the residential property market.

Increase the number of rental dwellings built through the stimulation of demand and investment, while supporting the building industry and related jobs and the Australian economy.

The NRAS Victoria program is also designed to provide a method and incentive for property investors to build wealth through NRAS property investment, while also stimulating the economy and the building industry across Australia. NRAS property investment is like purchasing any other investment accepts it comes with greater added benefits. To participate in NRAS in Victoria, investors need to buy an approved property. This is a new dwelling (it can be a house, townhouse, apartment, or other property type) located in an area identified by the government as having a high demand for affordable housing. After purchase, in exchange for offering tenants a modest 20% discount off the market rent, the Government provides investors with a tax free payment each year for a 10 year period. This means that for many investors their NRAS property investment will actually be cash flow positive. NRAS property investment also offers investors other advantages. The discounted rent not only provides great tax benefits through negative gearing, it also means that NRAS in Victoria properties are hugely popular with tenants. As result investors don t need to worry about their property being vacant and costing them money. While tenants do face some income restrictions, it is estimated that more than 1.5 million Australian households are eligible to rent NRAS properties.

An NRAS property investment will allow you to access a direct residential property investment in a highly sought after location; reduce your tax burden through negative gearing; earn over $110,000 in tax free income from government incentives for every property purchased; potentially enjoy positive cash flow from day one; access finance strategy advice to help you purchase the property using little or none of your own money; be supported by a cohesive, experienced team of mortgage managers, and property managers; make a socially responsible investment that benefits valuable members of our community; enjoy increased equity as the property grows in value and build your property portfolio. NRAS property investment is a truly unique investment which offers investors both lucrative returns and low levels of risk.

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