Stamp duty changes benefit first-timers
The Government’s removal of stamp duty for both new and established properties to the value of $650,000, is the first recent glimmer of hope for first homeowners in NSW.
The concession which comes into effect on 1st July this year, is a much needed improvement on the existing concession, where stamp duty was removed only on brand new properties up to $550,000.
There will be further stamp duty discounts for properties between $650,000 and $800,000.
The new concession will save first home owners approximately $25,000 in upfront costs, allowing them to get onto the property ladder much sooner. A first home owner will now need around $35,000 in savings to buy a $650,000 property, compared to the previous $60,000 needed.
Although the median house and apartment prices in Sydney are just over $1m and $743,000 respectively, at the time of writing this article, there are 88 properties available on realestate.com.au below $650,000 in the Hornsby and surrounding areas, showing that this is a legitimate concession that local first homeowners can take full advantage of.
In addition, the government has abolished stamp duty on lender’s mortgage insurance which can save you around $2,900 on an $800,000 property. Lender’s mortgage insurance is paid on home loans when the borrower has less than a 20% deposit.
The news isn’t so good for foreign investors as the stamp duty has increased for them from 4% to 8%, along with land tax increasing from 0.75% to 2%.
$3bn spending on infrastructure and new builds
The concession will drive up demand in property with more buyers in the market. The government, however, has committed to additional spending to infrastructure and the acceleration to build more properties.
The $3 billion fund will aim to streamline development applications in order speed up the building of new properties.
There‘s also a $10,000 first homeowners grant for first homeowners buying a brand new property to the value of $750,000.