NRAS – What is it and how does it work?

We have heard a lot about NRAS (National Rental Affordability Scheme) over the past few years and we will continue hearing about it in future.

The National Rental Affordability Scheme was introduced by the Federal Government in 2008. It was designed to encourage investors into the market by offering tax benefits.

Not just any property can be approved for NRAS. They are house and land packages, all over Adelaide offered by a number of builders subject to them being approved by the government.

The properties are designed for tenants receiving low to moderate income, therefore the landlord needs to rent the property for 20% under market value.

For example, if a property was valued at $300 per week, the landlord would need to rent it out for no more than $240 per week to receive the benefits. In return you would receive approximately $9,500. Take away the management fee and you would be left with $8,500.

So you would be giving away $60, but receiving $163 in return, a profit of $100 just for lowering the rent.

Obviously, the downfall to this is that you don’t receive the funds back until the end of the year.

Tenant Eligibility

• Single income earners maximum = $41,514
• Couples with no children = $57,391
• Couples with 1 child = $71,159
• Couples with 2 children = $84,927
• Couples with 3 or more children = $98,695

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