2010 to 2016
Depreciation on a property built in 2016
A residential building whose construction began in 2016 is deducted at 2.5% of its construction cost a year, for construction begun after 15 September 1987. Counting from 30 June 2016, its 40 years run from the 2016–17 income year to 2055–56, and from 2026–27 it has 30 income years left. Our national series puts new houses at $1,303 per m² of floor area in the year to 30 June 2016, 2% up on 2015's $1,282.
- Rate
- 2.5%
- Years left
- 30
- Last year
- 2055–56
What a house built in 2016 cost, state by state
A standard 200 m² single-storey brick veneer house at 2016 rates, less the builder's plant (3.4% of its cost that year), listed separately; the deduction is 2.5% of it a year.
| State | Rate per m² in 2016 | Construction cost | Deduction a year | Left to claim |
|---|---|---|---|---|
| New South Wales | $1,469 | $266,095 | $6,652 | $199,560 |
| Victoria | $1,294 | $234,349 | $5,859 | $175,770 |
| Queensland | $1,222 | $221,382 | $5,535 | $166,050 |
| Western Australia | $1,016 | $184,110 | $4,603 | $138,090 |
| South Australia | $863 | $156,361 | $3,909 | $117,270 |
| Tasmania | $1,269 | $229,887 | $5,747 | $172,410 |
| Australian Capital Territory | $1,240 | $224,681 | $5,617 | $168,510 |
| Northern Territory | $2,003 | $362,878 | $9,072 | $272,160 |
Indicative. "Left to claim" is the deduction a year times the 30 income years left; the first and last are usually part years.
The cost per m² around 2016
From 2015 to 2016 the standard house's rate per m² rose 2%, from $1,232 to $1,255: the 30th steepest of the 40 year-on-year changes since 1985. In 2017 it rose 3% again, to $1,294. At 2025's rates it costs $347,938 to build, 1.5 times its 2016 cost of $227,413, and the deduction is worked from the 2016 figure.
Building in 2016, nationally
The ABS measure: the value of new houses built (land excluded) over their floor area, so it follows the kind of house as well as prices, and its 2016 is the year to 30 June 2016.
The rate per m²
Our national series puts new houses in the year to 30 June 2016 at $1,303 per m² of floor area, 2% up on 2015's $1,282 and 52% up over the ten years from 2006's $858.
The average new house
We put the average new house of 2016 at about 236 m² of floor area, read between the ABS figures for 2013 (241.1 m²) and 2018 (231.9 m²): at 2016's $1,303 per m², it cost about $307,000 to build.
How the figure was reached
How 2016's figure was arrived at: between the 2013 and 2018 figures, following the ABS house construction output index. It rests on 1 source and is graded B, from A (a published figure) to D (an assumed rate of growth).
2016 in Division 43's history
- Section 40-27 on second-hand plant began 128 days after 2016 ended, from 7.30 pm on 9 May 2017.
- Counting the calendar year each began in as its first, 2016 is the 32nd year of capital works for homes (from 18 July 1985), the 30th year of the rate of 2.5% over 40 years (from 16 September 1987) and the 25th year of structural improvements' claims (from 27 February 1992).
Where it stands in 2026–27
2026–27 is the 11th of its 40 income years at 2.5%. 30 income years, this one counted, carry 75% of its construction cost; the 25% of the 10 years before is spent, whoever owned it then. The first half of its years ends with 2035–36.
A kitchen replaced ten years on, in 2026, is new capital works with 40 years of its own, claimed until 2066: 10 years past 2016's own last income year, 2055–56. Every renovation since 2016 is the same, whatever the house's own date; its invoices and photos date it.
Renovating a rental built in 2016: the old plant and works Houses of 2010 to 2016 beside the other years Using a previous owner's scheduleA standard house's plant, fitted new in 2016
In 2016 the builder's plant was about 3.4% of a standard house's cost, listed apart from the building; plant prices stood at 96% of 2020's by our plant index, and the ABS house construction price index for Australia stood at 94% of its June quarter 2020 level in the June quarter 2016. Fitted in 2016, with each life counted from 30 June 2016 as the building's years are, 3 of the 6 below have passed their effective lives, and the next ends in 2027–28; a replacement bought new for a let property starts its own.
| Item | Installed new, 2016 prices | Effective life | Life ends, income year |
|---|---|---|---|
| Oven | $1,523 | 12 years | 2027–28 |
| Cooktop | $599 | 12 years | 2027–28 |
| Dishwasher | $1,015 | 8 years | 2023–24 |
| Electric hot water system | $1,380 | 12 years | 2027–28 |
| Carpet | $3,616 | 8 years | 2023–24 |
| Blinds | $1,380 | 10 years | 2025–26 |
Common questions
How much depreciation can I claim on a house built in 2016?
On a 2016 building, 2.5% of what it cost to construct, each year until 2055–56. For a standard 200 m² brick veneer house that is about $6,652 a year in New South Wales, $5,859 in Victoria and $5,535 in Queensland, with 30 income years left. Plant new to you adds to that, as does any renovation since 2016.
I bought a 2016 property second-hand. Does the deduction start again?
No: a 2016 building's 40 years run from its completion, not from your purchase, so a buyer claims the 30 income years left, 2026–27 to 2055–56, on the original construction cost rather than the price paid. Fitted new in 2016, 113 of the 181 kinds of plant our catalogue prices have passed their effective lives, and the other 68 end from 2027–28 to 2045–46. Section 40-27 reaches plant acquired from 7.30 pm on 9 May 2017, when a 2016 house was 1 year old or so: bought from an earlier owner since then, the plant that came with a 2016 house is generally not deductible (the 2017 rules set out who it reaches and the exceptions). A 2016 house first sold new at or after then, nobody having lived in it, is under the same rule as a newer one: its plant is generally deductible as well, provided no earlier owner could deduct for it, unless you live in it before renting it out.
What was the rate for 2016?
2.5% a year over 40 years, for construction begun after 15 September 1987: counting from 30 June 2016, the 2016–17 to 2055–56 income years. Construction begun on any day of 2016 qualifies, the window having opened on 16 September 1987, and 10 of its 40 income years have passed.
What did it cost to build a house in 2016?
In the year to 30 June 2016, our national series puts new houses at $1,303 per m² of floor area, 52% up over the ten years from 2006's $858, and the average new house, about 236 m², cost about $307,000 to build. At 2016's rates, our standard 200 m² single-storey brick veneer house, less the plant listed separately, cost about $227,413 at the national rate, against $223,322 in 2015 and $234,568 in 2017. In 2016 it was cheapest in South Australia, at $156,361, and dearest in the Northern Territory, at $362,878. Where the 2016 build's own cost is not documented, a schedule estimates it at 2016's rates, about $227,413 for that house nationally, by an appropriately qualified person, as Taxation Ruling TR 97/25 accepts.
General information only, not advice about your circumstances. Speak to a registered tax agent before relying on it.