First-time home buyers will be able to opt for a smaller annual property tax in a historic New South Wales government reform to begin phasing out the stamp duty.
The 2022-23 state budget has introduced a housing package called First Home Buyer Choice to make home ownership “more affordable”.
The scheme means that first-time home buyers will be eligible for an annual property tax of $ 400 plus a percentage of the value of the land instead of a lump sum payment.
The centerpiece of NSW’s budget was the elimination of the stamp duty for first-time home buyers, a measure that will save thousands on initial costs. (new)
This new option is available for homes worth up to $ 1.5 million.
For example, a first-time homebuyer who buys an apartment in Sydney for $ 830,000 with a land value of $ 265,000 will have the option to pay an initial stamp duty of $ 32,440 or an initial property tax of $ 1,195.
First-time homebuyers are already exempt from paying home stamp duty up to $ 650,000 under existing government plans.
NSW Prime Minister Dominic Perrottet said the government wants to “lower the barriers” so that the first home buyers have a place of their own.
“The first choice of home buyer will eliminate one of the biggest initial costs of buying a home and help provide a better future for first home buyers,” Perrottet said.
Treasurer Matt Kean said this historic renovation will allow more young people to access home ownership.
“We know that the first home buyers are forced to enter the real estate market later and this reform will make the real estate market more accessible to them,” he said.
“It will mean that more New South Wales residents will move into their first home at an earlier age and achieve the great Australian dream of owning a home.”
NSW Prime Minister Dominic Perrottet said he was lowering entry barriers for those who want to enter the real estate market. (new)
The scheme will be launched from January 16 next year and the government will try to enact the legislation by the end of the year.
However, if you buy your first home between the time the legislation is enacted and January 15 next year, you will be able to receive a full refund of the stamp duty payment.
One of the government’s key investments this year is the first home buyers, with a $ 2.8 billion housing package that includes the stamp duty reform and the previously announced share capital scheme.
The shared equity plan, which is expected to reach a budget of more than $ 780 million, includes support for single parents, single adults and front-line workers such as nurses and police officers to buy a home under trial.
First-time homebuyers will save thousands on start-up costs by lowering stamp duty. (Peter Rae)
The government will provide 40% for new homes and 30% for existing homes under $ 950,000.
Over the next two years, 3,000 people will be eligible for the test program.
The state government also plans to improve more than 15,000 social homes to ensure they are “suitable for aging and less mobile residents” in a $ 300 million investment.
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