NRAS INVESTORS
THE NRAS INCENTIVE
NRAS offers investors a substantial annual tax-free incentive, called the NRAS Incentive, which is payable per dwelling.
The NRAS Incentive is a subsidy not available to standard residential property investors. The NRAS Incentive is available to investors who agree to rent approved dwellings at 20% or more below current market rates, to low and moderate income households.
Each approved dwelling attracts the NRAS Incentive for 10 years, as long as investors continue to comply with conditions around tenant eligibility and rent levels. The Australian Government has no legal or equitable claim over the property. NRAS investors can therefore expect to benefit from the annual NRAS Incentive, rental yields and capital gain.
The NRAS Incentive is currently $9,524 per dwelling, and is indexed each NRAS year (1 May – 30 April) to the rental component of the CPI. The incentive comprises:
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an Australian Government contribution of $7,143 per dwelling per year (paid as a refundable tax offset or payment) and
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a State or Territory Government contribution of $2,381 per dwelling per year (in direct or in-kind financial support)
The incentive is provided on a pro rata basis for the number of days in the NRAS year that the approved property was tenanted.
http://www.environment.gov.au/housing/nras/publications/policy/index.html
http://www.environment.gov.au/housing/nras/banks-and-financial-institutions.html
TYPES OF INVESTORS
NRAS investors range from institutional investors and property developers to not for profit housing providers and individual investors. Consortiums and non entity joint ventures are common models under NRAS.
Not for profit housing providers may also seek to participate in NRAS, relying on the NRAS Incentive as an income stream. Not for profit housing providers are currently regulated by States and Territories. The Commonwealth is planning to create a national system of regulation for not for profit housing organisations.
Builders and developers may be including NRAS properties in future developments for which they are seeking project finance. Developers may be planning to on-sell properties to approved NRAS providers, counting these properties as effective pre sales.
Most entities who apply to the Australian Government for NRAS Incentives are consortiums comprising investors, property developers and tenant managers.
http://www.environment.gov.au/housing/nras/investors.html
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