Federal government to review NRAS scheme over incentives trading

Concerns that incentives granted to developers and housing groups under the National Rental Affordability Scheme (NRAS) are being sold on a secondary market are to be investigated as part of the federal government’s review of the scheme.

The Australian Financial Review has reported that some developers were selling incentives for between $10,000 and $30,000 each.

Ahead of the release of the fifth round of 10,000 incentives, Mark Butler, the federal minister for housing and homelessness, said he had “heard the concerns about the timely use of incentives”.

“We will continue to refine this innovative program,” he said.

The scheme has come under attack from the opposition housing spokeswoman, Senator Marise Payne, who said its aim was to provide affordable housing – not for developers to make a quick profit.

An incentive allows for the building of an eligible NRAS home – property investors get an annual tax-free incentive of just under $10,000 and eligible renters get a 20% discount to the market rent.

Around 11,300 homes have been built under the scheme with a noticeable pick-up in delivery of new NRAS housing in the last 18 months.

Developers like David Devine’s Metro Property Development group have stepped up their marketing of NRAS properties with around half of new Brisbane apartments offered to investors under the scheme.

The government aims to build 50,000 new homes under NRAS by 2015.