New South Wales will eliminate stamp duty for first-time homebuyers in a major property reform that will be applied to today’s state budget.
Prime Minister Dominic Perrottet announced this morning the $ 728.6 million first home selection plan.
Under the initiative, first-time home buyers will be able to choose between a down payment or a lower annual property tax.
First-time home buyers will have a way out of the stamp duty in accordance with a new NSW government policy. (Steven Saphore)
For a middle-income household that saves 15 per cent of their income, the stamp duty adds about two years to the time needed to save the initial costs of the average NSW home.
The property tax option will be available for properties up to $ 1.5 million.
Under the new initiative, first-time homebuyers opting for the property tax will pay an annual property tax of $ 400 plus 0.3 percent of the value of the land in the property.
“Over the past two decades, the proportion of first-time home buyers under the age of 35 has decreased from 67% to 61%,” Perrottet said.
“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.”
Auctioneer Matthew Harvey sells a Putney property for more than $ 30,000 in Sydney on March 26, 2022. (Flavio Brancaleone)
Legislation to establish the real estate tax will be introduced during the second half of 2022 and eligible first home buyers will be able to apply for the adoption of the real estate tax from January 16, 2023.
For contracts exchanged in the period between the enactment of the legislation and January 15, 2023, buyers of the first eligible home will be able to opt from January 16, 2023 and receive a refund of the stamp duty already paid.
As of January 16, 2023, eligible first home buyers opting for First Home Buyer Choice will not pay stamp duty on their purchase. The property will not be locked into the plan if it is sold.
First-time home buyers will continue to be eligible to apply for a full stamp duty exemption for properties of up to $ 650,000. Stamp duty concessions remain in effect for properties between $ 650,000 and $ 800,000.
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