New South Wales is the first state government in Australia to introduce zero percent stamp duty, but with limitations and a two year trial period.
NSW Treasurer Eric Roozendaal announced as a part of the NSW State Budget, that beginning on July 1st people buying ‘off the plan’ will be exempt from stamp duty for the next two years.
Stamp duty was reduced in last year’s budget by 50 percent on new homes worth up to $600,000 from July 1 till the end of December last year. The NSW Government has seen fit to extend last year’s budget announcement by slashing stamp duty on new homes to zero percent for a period of up to two years, until which it will revert to previous rates.
Property Council of Australia NSW Acting Executive Director Glenn Byres believes the slashing of stamp duty for new houses is evidence the NSW Government sees the need to stimulate new housing construction in the state.
“We need new solutions if we are going to close the supply gap and tilt the affordability equation back in favour of homebuyers,” Director Byres said.
“The Government has done the right thing in recognising that cuts to stamp duty targeted at new homes will drive supply and lend a hand to homebuyers.”
“Sydney faces an enormous task in providing 26,000 new homes a year to accommodate the inevitable growth in population.” Director Byres said.
Rich Harvey, chief executive of Propertybuyer told The Australian that the changes to stamp duty are a step in the right direction.
“That is a definite incentive — that is making us competitive with Victoria,” Mr Harvey told the paper.
In broader reforms to Stamp Duty, those buying new homes up to $600,000 after the ‘off the plan’ stage will save 25 percent on stamp duty. Purchasers of vacant blocks of land would pay zero Stamp Duty and Australians over 65 who wish to downsize into a newly constructed home up to $600,000 will be exempt from Stamp Duty.
