The Meeting Place

Why is rural home and property treated so differently to city/urban one?

I am still trying to work out why retiring to a modest rural home on more than 2 hectares disadvantages you. 

More than 2 hectares counted as asset for pension [and deemed to make money - haha] when my previous home worth a large amount more in the city was not counted as an asset at all.

Our property is conservation zoned, CANNOT be subdivided, is mostly bush and the only property available in the area.  No small 5 acre blocks here.  Pity we didn't move beforehand and meet the 20 year rule.

People are being encouraged to come to regional Victoria etc!! 

Why are we targetted for this?   

Cathy McGowan asked for equity for rural pensioners last year - to take time down from 20 to 10 years but guess the Policy Costing she got put a stop to it. 

I still don't understand.  I heard on radio this week of 2 people who lost pension/newstart because their rural property was revalued and larger percentage now asset.  You only find out when you chase down the info.     Anyone know more about this please?

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Each property is different, it may not have any resaleable value, so don't be too concerned.

It is also personal choice to sit on non-income earning assets that are counted in the asset means test. Your excess acreage is little different in concept to a second residence.

Not really!

Not really a personal choice or not really non-income earning acres like a non-income earning second residence? 

Land developers would love to snap you land up to sell to our perpetual migrants and further inflate the value.

It has a lot of restrictions on it with conservation zoning and overlays so only one building and one outbuilding allowed and unlikely to change in the foreseeable future Jackie.  

This so called asset came about, I believe for farmers who could sell off, or make money from a property by leasing or agisting or making an income from. It is totally unfair for people who live on a modest rural block, that they cannot subdivide, or make money from. It should not be included in the asset test, unless you can claim income from it. Why should someone in a higher valued house, but average block, receive a pension, but others, whose house may be of lesser value, be denied because they live out in the sticks with some bush, which then becomes part of a land asset test?  There are people living in properties worth far more than yours, no doubt, who can claim a pension. This is just another grab from the government to knock as many people off the pension as possible. New Start is another debacle. Many people have been caught by this land asset test, but the current government is not interested. 

My understanding of a financial asset is something of value that is liquid and can be traded. The assets test legislation, could be open to interpretation. DHS have interpreted it in a way that benefits the government coffers and denies benefit to those it is meant to protect. 

We have challenged DHS to explain why our cutilage is considered an additional asset, if we cannot sell it, make money etc from it. They have no answer.

Thank you Murmur  -  looks like I am not alone.   

I understand these rules come in to minimise amounts they pay us and because people have abused the situation before.   

How soon are they going to decrease the deeming on these so called 'assets'?

We have had our propery for over twenty years and applied for it not to be an asset It earns no money, has no potential to do so and can't be subdivided.We had no luck and have been told that everyone that applies is rejected. As usual no reasons given.

My advice to all would be to buy below 5 acres. Be aware that over 5 acres is also subject to capital gains when sold.

That’s a bit of a surprise Smiles, as the Land Assets Test gives an example of a couple whose land, on a single title, is exempt, because they have lived there for more than 20 years. I’m wondering if you have lived on it for 20 years? 

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