Media Release Clarifies Position on Re-sales of Off-the-Plan Lots Failing to Settle
The Treasurer has issued a Media Release regarding the Federal Government’s plan to make changes to the foreign investment framework, allowing developers to resell off-the-plan lots that previously failed to settle.
In the Release, the Treasurer states:
- It is common sense that an apartment or house that has just been built, or is still under construction and for which the title has never changed hands, is not considered an established dwelling.
- In the event of a failure to complete settlement, the dwelling should revert to its previous status – that is, a new dwelling.
What this means for developers with exemption certificates
A regulation change will be made “at the next opportunity”, which will allow developers to sell dwellings that would otherwise be considered new but for the failed settlement.
The Commissioner of Taxation has confirmed that, until the regulation change, it will not take action against persons who would have been covered by the exemption certificate if it were not for the preceding failed settlement.
What this means for developers without exemption certificates
The change of policy will be “implemented immediately”, whereby a dwelling considered established due only to a failed settlement will be assessed as a new dwelling.
Should you wish to discuss this matter further, please contact Matthew Weaver of Nicholsons Solicitors.
Matthew practices in all areas of property and conveyance law with particular interest in off plan residential and mixed use community titled projects, management rights and Body Corporate matters. Matthew enjoys working closely with clients to maximise value from each transaction.
 Treasury (Cth), ‘Government to Allow On-sale of Off-the-Plan Dwellings Failing to Reach Settlement’ (Media Release 122/2016, 26 November 2016). http://sjm.ministers.treasury.gov.au/media-release/122-2016/