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The NRAS Guide to Securing Your Financial Future

For savvy investors who want to do good and get serious returns

What is the National Rental Affordability Scheme (NRAS)?

Affordable housing is in short supply nationwide. The NRAS is an initiative by Federal and State Governments to encourage new housing construction in Australia.

It’s focus is: Increasing the supply of affordable rental properties Reducing rental costs for low- and moderate-income households Encouraging large-scale investment in affordable housing.

The scheme promotes affordable housing by offering financial incentives to invest in and rent homes to eligible low- and medium-income tenants.

Housing types range from single units to houses and apartments, usually managed by non-profit community housing providers.

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The major players

INVESTORS

TENANTS

MANAGEMENT

NRAS encourages property investment and is so available to small scale, private or individual investors.

Eligible tenants are those in moderateincome households.

Testing thresholds vary according to household composition.

While the Australian Government oversees the NRAS, the Department of Communities takes care of the State Government’s funding.

Potential tenants provide written evidence of their gross income to a tenancy manager each year to remain eligible for the scheme.

Your property will be managed on your behalf by professional property and tenancy managers to ensure compliance with NRAS legislation and regulations.

Individual investors can purchase these properties in a selfmanaged super fund, property trust company or in their own name.

As an approved applicant, you’ll agree to rent your properties to eligible tenants for at least 20 percent below the market value rent.

In return, you’ll receive yearly tax-free incentives.

Tenancy demand is high. Tenancy managers review applications and maintain waiting lists for NRAS homes, but the final decision is always made by the property owner.

All other standard rental requirements apply.

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Next Steps

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Am I eligible to invest?

If you’re an individual, company, trust, SMSF or interstate or overseas investor, NRAS offers a great ethical investment opportunity for you.

As your nominated NRAS company, WAI Group can take you through all your options and help you decide whether NRAS investment is right for you.

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What’s in it for me?

Other than helping those who need it the most? In a nutshell, NRAS properties: • Produce income tax refunds through negative gearing, just like other investment properties • Generate positive cash flow • Receive approximately $66,000 tax free cash from the Government over 6 years.

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More great benefits to investing in an NRAS property • Invest in emerging suburbs. Sell when the market is high • Access Federal and State Government investment incentives up to $11,270 per annum • Government incentives are indexed annually and available for approved NRAS property until 2026.

• Harness high rental yields and potential capital gains.

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How can I purchase a NRAS property?

Contact WAI Group today – we’ll walk you through your options and show you how to get the best results.

Tell me more about the tax incentives You’ll receive some of your incentive as a refundable tax offset (RTO) and some as a non-assessable, non-exempt income (NANE).

All of this income is tax free in the hands of the investor.

As with all property investments, you can deduct costs associated with owning your property such as:

Can I sell or remove my property from the scheme and rent it at market rates?

Yes. Subject to any other contractual obligations, if you no longer want to participate in the scheme you can sell your property or end your participation prior to the end of the NRAS term without penalty.

• Property management fees • Insurances • Rates • Interest costs • Other Tax benefits such as depreciation.

How do NRAS property values stack up?

Most asset and investment values fluctuate with time. However, direct property investments consistently show good returns.

They also can be less volatile than other asset classes and investments, such as listed equities. And, as your core investment is direct property, you’ll benefit from any capital growth.

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The WA property market The Perth property continues to see good news with CoreLogic’s head of research, Eliza Owen, reporting that PERTH stands out as a market “primed for recovery”, with more listings, more sales and even some price growth.

CoreLogic has reported that for the four weeks ending the 20th September, Perth and regional WA were the only dwelling markets where new listings volumes exceeded the numbers in the equivalent four week period of the previous year.

Listings are not the only transaction data suggesting more confidence, Perth has also been the ONLY capital city to show sales numbers above the pre-COVID average.

Perth property values are still affordable and with the State and Federal Government Grants of up to $55,000 - this is encouraging buyer demand.

For the month of September, SQM Research has reported that Perth Vacancy Rates have fallen to a staggering 0.9%.

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Call us today on (08) 9267 3800

www.waigroup.com.au

ABOUT WAI GROUP At WAI Group, we bring financial services and a real estate agency together under one roof, using our cumulative knowledge to deliver target advice for property investors that get measurable results.

As Perth’s premier NRAS specialists, we can guide you through the scheme from initial application to realising your capital gains, helping you choose the right properties in the right locations to maximise your ROI.

WA’S BIG GST WIN Western Australia has also been the big winner in the Federal GST distribution shake-up.

This long fought-for win sees no less than 70 cents for each GST dollar paid directed to WA—that’s a big increase for the previous 34 cents per dollar received.

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We look forward to helping you secure your financial future Book a call to find out more on (08) 92673800 Sign up with us at www.waigroup.com.au/sign-up