At its meeting on the 11th August the QLDC voted to proceed with a variation to the Proposed District Plan which, if approved will impose a new tax on developers who create new residential sections and on those that seek to build apartments to sell or rent or, in what is a consequence of the proposed Plan Change, capture those individuals that have a vacant section but may be looking to build in the future. Given those owners would have purchased their section not knowing of the pending tax means the Plan Change will have retrospective impact on those property owners.
The new tax is in the form of what is known as Inclusionary Zoning and is being promoted on the basis that the sums collected by Council will be used to fund affordable housing initiatives within the Queenstown Lakes District.
The tax will be assessed as follows:
a) If you create less than 20 lots in a residential zone you will pay 5% of the estimated sales value of those lots;
b) if you create more than 20 lots in a residential zone you must pay a contribution of 5% of the serviced lots to Council;
c) if you create any lots in the Rural Residential, Lifestyle Precinct or Special zone you will pay 1% of the estimated sales value of the lots created;
d) if you build on any vacant lot zoned residential for which the tax has not been paid you will pay the lesser of 2% of the estimated sales value of the additional unit OR $150 per sqm of the net increase in residential floorspace;
e) if you build on any of the lots created by c) above you will pay $75per sqm of floor space;
f) if you build on a lot on which the new tax has been paid you will still pay a contribution based on a formula.
There are exemptions for Residential Flats, Retirement Villages or subdivision or development of Maori Land.
The above will mean someone building a 150m2 house at Hanley Farms will pay a minimum of $22,500-00.
If you build a 400m2 home in Arrowtown you will pay $60,000-00.
The proposed Plan Change to give effect to these rules is likely to be publicly notified for submission in the next few weeks. Those potentially affected should ensure they file a submission.