The State budget was delivered on Tuesday 20th June 2017. While there are a number of initiatives, changes to stamp duty may be beneficial for persons considering selling their property or those trying to enter the property market.
Stamp Duty Changes
From 1 July 2017 stamp duty on properties purchased by first home buyers up to $650,000 will be reduced to nil. This is up from $550,000 and also now includes existing properties, rather than new properties only. When compared with existing legislation, this can mean a significant reduction in the entry cost of first home owners entering the market. A summary of these changes is as follows:
|First home purchase price||Ordinary stamp duty||Savings for first home buyers of new dwellings*||Savings for first home buyers of existing dwellings*|
*Total of stamp duty exemptions plus first home owners grant plus savings from LMI duty abolition (Genworth LMI Premium Estimator based on a first home buyer with a $50,000 deposit).**Does not include additional land tax surcharge.
To be able to access these benefits, first home buyers must live in the property for a minimum of any 6 months continuous occupancy in the year post purchase.
LM comment: It is difficult to gauge the effect this will have on the Sydney market as median properties price is now one million dollars. There may be some benefit to units, outlying suburbs or regional areas.
Stamp Duty Foreign buyers
Stamp duty for foreign buyers will double from 1 July 2017 from 4%-8%. For persons wishing to sell their properties post 30 June 2017, foreign buyers will have less buying capacity. This may affect the return some sellers expect of the sale of the property.