This week we begin a new series looking at capital city suburbs with the longest hold periods, focusing on two suburbs in Sydney.
And in our tax tip of the week, we look at deceased estates and joint tenancy for capital gains tax purposes.
News
The Housing Industry Association of Australia has called on the government to lessen the impact of regulation on new housing supply affordability, following data showing a significant decline in new homes sales. The HIA/Jeld-Wen new home sales survey of Australia’s major residential builders revealed new homes sold dropped 7 per cent in July, the third consecutive month of falls. Sales declined 8 per cent in the June quarter, down 2 per cent on the same time last year. HIA is calling on the new government to state their commitment to pursing three key policy priorities: A housing cost reduction program, housing and development ministry and recognition and support for small business.
And in other news, a survey of over 1,600 older home owners by the Australian Housing and Urban Research Institute revealed more than 90 per cent think their home is the right size. While many are under-occupied and so under-utilised, the survey showed most would be unwilling to move despite the nation’s increasing housing availability challenges.
Suburb in Focus In our suburb in focus, we begin a new series looking at suburbs with the longest hold periods in capital cities around Australia. This week we start with two suburbs in Sydney.A ‘hold period’ is a calculation which measures the time period between sales, expressed in years. Generally those areas which have the longest hold periods are long established desirable areas with good infrastructure.First let’s look at the housing market in Taren Point in the Sutherland Shire, located around 24 kilometres south of Sydney’s CBD.According to figures from RP Data, Taren Point has one of the longest hold periods of any suburb in Sydney, with properties held for almost 15 years. Sydney’s average hold period for houses is 9.1 years.The suburb’s population in the 2006 census was 1,231 with a high population of residents from the UK, Italy and Greece. Taren Point has a mix of up-market, waterfront houses and more modest suburban homes located on the banks of Georges River, at the mouth of Botany Bay. It is the first landing place of Captain James Cook and contains one end of the famous Captain Cook Bridge.Turning to the figures, the median house price in Taren Point in the year to May 2010 was $1.2 million, with the average hold period for a house in the suburb 14.9 years. 20 properties were sold in Taren Point for the 12 month period.
Our next suburb is the house market in Rodd Point located around 8 kilometres west of Sydney’s CBD. RP Data figures reveal that properties in Rodd Point are held, on average, 14.5 years before being sold.With a population of 1,244 Rodd Point is situated on Iron Cove, on the Parramatta River. The Bay Run is a popular pathway that passes beside Rodd Park and is enjoyed by joggers, walkers and cyclists. The suburb has sports fields, playgrounds, sailing, rowing and an aquatic centre.Taking a look at the figures, the median house in Rodd Point for the year to May 2010 was $1.18 million. The average hold period for a property in the suburb is 14.7 years. 25 properties were sold in the 12 month period.
Tax Tip
And now to the Tax Tip of the week from Depreciator - the Tax Depreciation Schedule specialists.This week’s tip looks at deceased estates and joint tenancy for capital gains tax purposes.If two or more people acquire a property together, it can be either as tenants in common or as joint tenants.
If a tenant in common dies, their interest in the property is an asset of their deceased estate. This means it can be transferred only to a beneficiary of the estate or be sold (or otherwise dealt with) by the legal personal representative of the estate. If one of the joint tenants dies, their interest in the property passes to the surviving joint tenant(s). It is not an asset of the deceased estate.
For capital gains tax (CGT) purposes, if you are a joint tenant you are treated as if you are a tenant in common owning equal shares in the asset. However, if you are a joint tenant and another joint tenant dies, on that date their interest in the asset is taken to pass in equal shares to you and any other surviving joint tenants, as if their interest is an asset of their deceased estate and you are beneficiaries.
This means if the dwelling was the deceased’s main residence, you may be entitled to the main residence exemption for the interest you acquired from them.
And as always, remember to consult a tax accountant or tax professional before making any tax related decisions.
