In the Federal Budget of 2017, the Treasurer introduced an incentive for people aged 65 years and older to make a non-taxed contribution to their super fund of up to $300,000 per spouse that resulted from a downsizing of the family home. By example, if a 65-year-old is selling the family home for $1,200,000 and buying a retirement home for $600,000 then the difference of $600,000 can be contributed to the super fund, being $300,000 for each spouse. This contribution has no tax implications either on the way in or way out and, with the benefit of fully franked dividends, presents a massive boost to the Baby Boomer’s retirement plans.
But, just as importantly, as Baby Boomers sell down in the way exampled above, the real estate market will be mobilised with more stock of badly needed family homes that feed perfectly into the undersupplied second-time home buyer market. In turn, second-time home buyers will be selling their properties into the first-time home buyer sector. There are winners across the whole spectrum of residential real estate out of this clever and critically important tax incentive. I urge you all to refer this matter to your accountant for clarification and relevance to your position. And then ring me to sell your home for a fee of only 1.1% of the achieved sale price.