Stamp duty and first homeowner grant changes in effect across Australia

On 1 July, a raft of changes were introduced to stamp duty regimes across the country. Here, we look at what’s changed, state-by-state.

Stamp duty is paid to the relevant state government when a property transaction occurs.

New South Wales

Much has changed to the stamp duty regime in New South Wales, which has experienced one of the most active property markets in the country.

Property prices have risen sharply, especially in Sydney.

So concessions have been introduced to alleviate concerns that some groups such as first home buyers are being kept out of the market.

From 1 July, no stamp duty will be payable for properties bought by first home buyers for homes sold for up to $650,000.

Stamp duty discounts are also available on a sliding scale for first home buyers that buy properties of up to $800,000.

Additionally, stamp duty on lenders’ mortgage insurance has been abolished from 1 July. However, investors can no longer defer the cost of stamp duty for 12 months, and foreign investors now pay more stamp duty than Australian residents.

Victoria

In Victoria, a similar suite of stamp duty concessions has been offered to people buying their first home.

There’s no stamp duty payable for first home buyers whose properties cost up to $600,000, and there are discounts on a sliding scale for properties of up to $750,000.

In Victoria, there’s also a $10,000 first home owner grant available for new properties that sell for less than $750,000. If the property is in regional Victoria the grant doubles to $20,000.

However, property buyers should note from 1 July stamp duty concessions no longer apply for investors in new, off-the-plan properties. Additionally, foreign buyers pay more stamp duty than Australian residents.

Tasmania

Tasmania has a generous $20,000 first home owner grant, which the state government has indicated is available until 30 June 2018.

South Australia

In South Australia, a first home owner grant of $15,000 remains in place, with no indication it will be removed in the near future.

All property purchases, even those made by first home buyers, attract stamp duty in South Australia, with foreign residents required to pay additional stamp duty on property purchases.

However, the government is undertaking a staged phase out of stamp duty on non-fixed assets such as plant and equipment, qualifying commercial property and several other taxable business transactions.

This has been taking place since 2015, but a further one-third reduction came into force on 1 July this year. Stamp duty on non-fixed assets will be completely abolished from 1 July 2018.

Western Australia

In Western Australia, first home buyers and builders may apply for a grant of up to $10,000, although a $5,000 boost payment for this group ended on 1 July.

In this state first home buyers enjoy concessional stamp duty for houses that cost up to $530,000 or $400,000 for vacant land.

Stamp duty rules change regularly, so it’s an idea to check in with your mortgage broker to see whether there have been any recent changes, or whether changes are expected in the future.