This week we continue our series looking at suburbs with the highest median prices in 2010, with a focus on two suburbs in Western Australia. We speak with Aaron Gadiel, chief executive officer of the Urban Taskforce Australia about the Government’s National Urban Policy. And in our tax tip we look at renting property to relatives.
News
According to the Australian Bureau of Statistics, housing starts rose 3 per cent in the March quarter. Total starts rose to 39,578 in the three months to March 31 on a seasonally-adjusted basis. Private sector housing starts declined 1.9 per cent, while starts for units and apartments jumped 14 per cent. UBS economist Alvin Pontoh says the data is better-than-expected but needs to hold steady in the face of softer construction data.
And RP Data says a significant drop in median house prices at the top end of the property market has created an unexpected lift for the nation’s more affordable property markets. Twenty per cent of the most expensive capital city suburbs recorded house price falls of 5.4 per cent over the 12 months to April 2011. That compares to a drop of only 0.5 per cent at the most affordable end.
Suburbs in Focus
This week we continue our series looking at suburbs with the highest median prices in 2010, with a focus on two suburbs in Western Australia.
First let’s look at Peppermint Grove, a suburb located 13 kilometres south-west of Perth’s central business district. With a population of 1,580 in the last census, the suburb is situated between the Stirling Highway in the west and Swan River at Freshwater Bay to the east, spanning six blocks. Peppermint Grove is Australia’s most expensive suburb, with the Premier calling it “Australia’s Monaco” due to its small size and high concentration of wealth. Cottesloe Primary School and Presbyterian Ladies’ College are located within the suburb. There’s a small shopping centre and reserves along the riverfront offering recreational facilities.
Turning to the figures, houses in Peppermint Grove recorded the capital’s highest median price in 2010 of $4,675,000. 19 properties were sold in the year.
Our next suburb is Dalkeith, located 10 kilometres south-west of Perth’s CBD. With a population of 4,206 in the last census, the suburb is surrounded on three sides by the Swan River. Dalkeith is home to some of Perth’s finest homes. Along the southern Riverside is Sunset Hospital, which was closed in 1995. There have been attempts to redevelop the site, but due to the heritage status of some of the properties, development plans have to date been unsuccessful. Houses selling for above $5 million are not uncommon in Dalkeith. Residential blocks of land are also for sale.
Turning to the figures, houses in Dalkeith recorded the capital’s second highest median price in 2010 of $2,700,000. 65 properties were sold in the year.
Interview
We speak with Aaron Gadiel, chief executive officer of the Urban Taskforce Australia about the Government’s National Urban Policy.
Tax Tip
And now to the Tax Tip of the week from Depreciator - the Tax Depreciation Schedule specialists. This week we take a look at letting of property to relatives.
When an investment property is let out to relatives, if the arrangement is consistent with normal commercial practices, the owner of the property is treated the same for income tax purposes as if they were renting to strangers. Even if the property is rented to relatives at less than commercial rates, the rent collected would still be considered assessable income.
However, board and lodging for family members is considered to be a domestic arrangement and doesn’t need to be declared as income. As always, do remember to consult with a tax accountant or tax professional before making any tax related decisions.
