fbpx
Print this page
Friday, 22 February 2019 14:09

A capital gains tax on lifestyle homes?

Written by 
Bindi Norwell, chief executive at REINZ. Bindi Norwell, chief executive at REINZ.

A significant number of lifestyle block owners may have to pay a capital gains tax on their family home, warns the Real Estate Institute of NZ.

Under the Tax Working Group’s proposal, which may come into effect after 1 April 2021, land that is larger than 4,500m2 is not subject to the family home Capital Gains Tax (CGT) exemption. 

“Indicating the potential size of the problem, in the last 12 months, REINZ data has shown that 92% of lifestyle blocks sold across the country were larger than 4,500m2,” says Bindi Norwell, chief executive at REINZ.

“If this is indicative of a normal year’s sales, then going forward, a similar portion of the market is likely to have to pay CGT on the portion of their land that is greater than 4,500m2.”

Norwell says it’s a case of “the devil being in the detail” of the report. She says REINZ doesn’t believe many members of the community are aware of the impact the CGT could have on their lifestyle block home.

“Should the recommendations make it past the 2020 election, what this means is that we could see a significant number of lifestyle blocks coming up for sale in the next few years as people look to avoid having to pay CGT on their property,” says Norwell.

“We have repeatedly said that any changes in legislation should avoid being too punitive on one sector of the market, and we will certainly be making a submission to this effect on behalf of those living on lifestyle blocks.”

More like this

Buyers hunting for right farm

It could be that buyers are hunting out the right farm to purchase as farm sales drop for the three months ended December 2023. That’s according to the Real Estate Institute of New Zealand (REINZ).

Buyers influence rural market

Recently released data from the Real Estate Institute of New Zealand (REINZ) shows there were 77 fewer farm sales for the three months ended November 2023 than for the three months ended November 2022.

Change in govt could boost farm sales

Recent data from the Real Estate Institute of New Zealand (REINZ) shows October was another month in which there were fewer farm sales than at the same time in 2022.

Farm sales down, values holding

Recent data from the Real Estate Institute of New Zealand (REINZ) shows a 22.5% drop in the amount of farm sales for the three months ended July 2023 than for the same period in 2022.

Farm sales dip, market holding

Recently released data from the Real Estate Institute of New Zealand (REINZ) shows that while the number of farm sales is low, the market remains strong.

Featured

Sheep drench resistance costly

Analysis by Dunedin-based Techion New Zealand shows the cost of undetected drench resistance in sheep has exploded to an estimated $98 million a year.

Dairy sheep and goat turmoil

Dairy sheep and goat farmers are being told to reduce milk supply as processors face a slump in global demand for their products.

Hurry up and slow down!

OPINION: We have good friends from way back who had lived in one of our major cities for many years.

National

Knowing bugs means fewer drugs

A mastitis management company claims to deliver the fastest and most accurate mastitis testing available at scale for New Zealand…

Machinery & Products

AGTEK and ARGO part ways

After 12 years of representing the Landini and McCormick brands in New Zealand, Bay of Plenty-based AGTEK and the brands’…

100 years of Farmall Tractors

Returning after an enforced break, the Wheat and Wheels Rally will take place on the Lauriston -Barhill Road, North-East of…

JD unveils its latest beast

John Deere has unveiled its most powerful tractor ever, with the launch of the all new 9RX Series Tractor line-up…

Biggest Quadtrac coming to NZ!

In the biggest announcement that Case IH Australia/New Zealand has made around its tractor range, its biggest tractor is about…