It’s Budget Time and for fiscal fanatics and economics enthusiasts it’s their favourite time of year while the rest of us just want to know ‘what’s in it for me’ or ‘what’s not in it for me’. The tax package is receiving the focus of the media analysis and craft beer devotees are toasting the announcement that they will pay slightly less for their beverage of choice, but what does Budget 2018 mean for property investors?

In my newsletter following the 2017 Federal Budget announcement, I noted that real estate investors may have felt blindsided by the Treasurer’s announced changes to the way deductions could be claimed on plant and equipment assets in residential properties.

Well 2018 presents us with a much different, and far more constructive scenario for property investors. Constructive being the key word in my analysis of what’s in it for us!

One of my key strategies for property selection is macro-economic analysis to identify geographical regions for capital growth potential. With one of the key indicators to look for - Infrastructure and Government Spending. And Budget 2018 offers us exactly that, right across the nation.

Infrastructure spending is a key component of the budget and what that represents for you, as a residential property investor, is the potential for your portfolio to increase in value in the areas targeted for infrastructure project. Plus, it offers opportunities to purchase in these areas now and realise the growth benefits both during project construction are when completed.

Transport infrastructure is at the heart of the 2018 Budget, particularly major roads spending. This has the potential to open up areas by improving access from residential areas to key commercial centres, ie jobs, as well as improve the key services and facilities which increases the attractiveness of rental properties. In the long term, this should result in significant increases to property values.

Astute investors, get ready to analyse the locations of these infrastructure projects and then research what investment properties are currently available in those locations to get in early.

In New South Wales, the projects that have my attention include:

• Pacific Highway Coffs Harbour Bypass and Nowra Bridge upgrade will both make travel through these areas faster and link smaller towns essentially closer to key regional areas while reducing traffic congestion through the towns and possibly improving quality of living. Milly’s tip: look for investment opps in smaller towns in these area
• Port Botany Rail Line Duplication. Milly’s tip: look for commercial and warehouse properties that will benefit.
• North-South Rail Link, Western Sydney and the Western Sydney Airport, both represents opportunities for jobs and will improve accessibility to and within this massive growth region.

In Victoria, I’m keeping an eye on:

• Melbourne Airport Rail Link, North East Link and the Monash Rail project, as all will improve access. Milly’s tip: look at the suburbs which will link residential to jobs centres.

Queensland will also receive funding for major highway and rail upgrades which will make outlying residential areas more attractive for investors:

• Bruce Highway, M1 Pacific Motorway; Beernurrum to Nambour Rail, Cunningham Highway
• Brisbane has been very attractive to investors for some time and the suburbs to be positively impacted by the Brisbane Metro project are ones to watch

For those looking west for property potential, the Budget has allocated funds for the METRONET rail project, to tackle congestion in Perth itself and for the Bunbury Outer Ring Road. Milly’s tip: I’ll be doing in-depth analysis of these areas, so stay in touch!

South Australia also receives funding for major projects including the North-South corridor projects; Regency to Pym Street section; Gawler rail line electrification and the Joy Baluch Bridge. Milly’s tip: look for residential properties in the suburbs to benefit most.

Tasmania is to receive additional funding for the Freight Rail Revitalisation so look for commercial areas which will benefit.

The Monaro Highway upgrade in the ACT will improve the trip to the snow for skiers, but also provide better access to Canberra from outlying towns, making them ideal investment opportunities for commuting to Canberra for work.

Regional areas will also receive funding through the Building Better Regions Fund and the Regional Growth Fund. With housing in capital cities continuing to rise, regional areas are becoming far more attractive, especially to young families. So don’t exclude these from your portfolio.

The Budget has been criticised for not addressing affordable housing. So how does that affect property investors? If you are interested in social responsibility investment, look for residential properties which you are prepared to offer at lower rental return in the short term to realise capital growth in the long term.

That’s my Budget 2018 snapshot, but there is plenty more to talk about once we drill down into specific areas. So please, let’s have a conversation about how I can assist you with your investment portfolio.