Affordable housing - what?

I’m not a cynic, but I do have a healthy scepticism.

The federal budget expanded a tax incentive if you invest in affordable housing. The specific rules are on the ATO website.

Should you do it?  If you have a benevolent goal to provide affordable housing, then maybe.

The sweetener is you get a capital gains tax discount increased from 50% to 60%. This means when you sell the property, 60% of the gain will be tax-free.

There is a sting in the tail.  After a compulsory 3 year period of ownership, where you provide the house to low and moderate income tenants, at a below market rate, you are unlikely to make a capital gain.

It will be interesting trying to financially model a positive result given all the variables.

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