2017 to today
Depreciation on a property built in 2018
A residential building whose construction began in 2018 is deducted at 2.5% of its construction cost a year, for construction begun after 15 September 1987. Counting from 30 June 2018, its 40 years run from the 2018–19 income year to 2057–58, and from 2026–27 it has 32 income years left. Our national series puts new houses at $1,388 per m² of floor area in the year to 30 June 2018, 3% up on 2017's $1,343.
- Rate
- 2.5%
- Years left
- 32
- Last year
- 2057–58
What a house built in 2018 cost, state by state
A standard 200 m² single-storey brick veneer house at 2018 rates, less the builder's plant (3.2% of its cost that year), listed separately; the deduction is 2.5% of it a year.
| State | Rate per m² in 2018 | Construction cost | Deduction a year | Left to claim |
|---|---|---|---|---|
| New South Wales | $1,598 | $290,169 | $7,254 | $232,128 |
| Victoria | $1,428 | $259,298 | $6,482 | $207,424 |
| Queensland | $1,318 | $239,186 | $5,980 | $191,360 |
| Western Australia | $984 | $178,713 | $4,468 | $142,976 |
| South Australia | $898 | $162,945 | $4,074 | $130,368 |
| Tasmania | $1,320 | $239,702 | $5,993 | $191,776 |
| Australian Capital Territory | $1,307 | $237,245 | $5,931 | $189,792 |
| Northern Territory | $2,014 | $365,656 | $9,141 | $292,512 |
Indicative. "Left to claim" is the deduction a year times the 32 income years left; the first and last are usually part years.
The cost per m² around 2018
From 2017 to 2018 the standard house's rate per m² rose 3%, from $1,294 to $1,336: the 21st steepest of the 40 year-on-year changes since 1985. In 2019 it held level, to $1,336. At 2025's rates it costs $347,938 to build, 1.4 times its 2018 cost of $242,467, and the deduction is worked from the 2018 figure.
Building in 2018, 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 2018 is the year to 30 June 2018.
The rate per m²
Our national series puts new houses in the year to 30 June 2018 at $1,388 per m² of floor area, 3% up on 2017's $1,343 and 41% up over the ten years from 2008's $987.
The average new house
We put the average new house of 2018 at 231.9 m² of floor area, the ABS's 2018 figure: at 2018's $1,388 per m², it cost about $322,000 to build.
How the figure was reached
How 2018's figure was arrived at: a published figure of medium or low confidence, blended with the interpolation. It rests on 1 source and is graded B, from A (a published figure) to D (an assumed rate of growth).
2018 in Division 43's history
- Section 40-27 on second-hand plant began 237 days before 2018 did, from 7.30 pm on 9 May 2017.
- Counting the calendar year each began in as its first, 2018 is the 34th year of capital works for homes (from 18 July 1985), the 32nd year of the rate of 2.5% over 40 years (from 16 September 1987) and the 27th year of structural improvements' claims (from 27 February 1992).
Where it stands in 2026–27
2026–27 is the 9th of its 40 income years at 2.5%. 32 income years, this one counted, carry 80% of its construction cost; the 20% of the 8 years before is spent, whoever owned it then. The first half of its years ends with 2037–38.
A kitchen replaced ten years on, in 2028, is new capital works with 40 years of its own, claimed until 2068: 10 years past 2018's own last income year, 2057–58. Every renovation since 2018 is the same, whatever the house's own date; its invoices and photos date it.
Renovating a rental built in 2018: the old plant and works Houses of 2017 to today beside the other years Using a previous owner's scheduleA standard house's plant, fitted new in 2018
In 2018 the builder's plant was about 3.2% of a standard house's cost, listed apart from the building; plant prices stood at 97% of 2020's by our plant index, and the ABS house construction price index for Australia stood at 100% of its June quarter 2020 level in the June quarter 2018. Fitted in 2018, with each life counted from 30 June 2018 as the building's years are, 2 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, 2018 prices | Effective life | Life ends, income year |
|---|---|---|---|
| Oven | $1,544 | 12 years | 2029–30 |
| Cooktop | $608 | 12 years | 2029–30 |
| Dishwasher | $1,030 | 8 years | 2025–26 |
| Electric hot water system | $1,399 | 12 years | 2029–30 |
| Carpet | $3,667 | 8 years | 2025–26 |
| Blinds | $1,399 | 10 years | 2027–28 |
Common questions
How much depreciation can I claim on a house built in 2018?
On a 2018 building, 2.5% of what it cost to construct, each year until 2057–58. For a standard 200 m² brick veneer house that is about $7,254 a year in New South Wales, $6,482 in Victoria and $5,980 in Queensland, with 32 income years left. Plant new to you adds to that, as does any renovation since 2018.
I bought a 2018 property second-hand. Does the deduction start again?
No: a 2018 building's 40 years run from its completion, not from your purchase, so a buyer claims the 32 income years left, 2026–27 to 2057–58, on the original construction cost rather than the price paid. Fitted new in 2018, 65 of the 181 kinds of plant our catalogue prices have passed their effective lives, and the other 116 end from 2027–28 to 2047–48. A 2018 house has only ever been under section 40-27, from 7.30 pm on 9 May 2017: bought from an earlier owner, the plant that came with a 2018 house is generally not deductible (the 2017 rules set out who it reaches and the exceptions). Bought new, nobody having lived in it, 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 2018?
2.5% a year over 40 years, for construction begun after 15 September 1987: counting from 30 June 2018, the 2018–19 to 2057–58 income years. Construction begun on any day of 2018 qualifies, the window having opened on 16 September 1987, and 8 of its 40 income years have passed.
What did it cost to build a house in 2018?
In the year to 30 June 2018, our national series puts new houses at $1,388 per m² of floor area, 41% up over the ten years from 2008's $987, and the average new house, about 232 m², cost about $322,000 to build. At 2018's rates, our standard 200 m² single-storey brick veneer house, less the plant listed separately, cost about $242,467 at the national rate, against $234,568 in 2017 and $242,467 in 2019. In 2018 it was cheapest in South Australia, at $162,945, and dearest in the Northern Territory, at $365,656. Where the 2018 build's own cost is not documented, a schedule estimates it at 2018's rates, about $242,467 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.