NSW to limit first-home stamp duty concessions

The NSW government will limit full stamp duty concessions to those buying new homes from 1 January 2012.

First-home buyers currently pay no stamp duty on all properties under $500,000 and receive a discount for properties valued up to $600,000. From January 1 next year, the stamp duty concessions will apply only to newly constructed homes, including those built off the plan.

The move is a welcome boost to the spring property market, with first-timers likely to stampede the affordable end of the general property market in order to capitalise on the current stamp duty savings.

The measure was unveiled today by Treasurer Mike Baird.

“We recognise this is a difficult decision, but we believe it is necessary to make buying a new house relatively more attractive than buying an existing dwelling for first-home buyers,” Baird says.

“The government has therefore decided that from 1 January next year, while all eligible first home buyers will continue to receive the $7,000 first-home owner’s grant, eligibility for additional stamp duty concessions will be limited to those purchasing newly constructed homes, including ‘off the plan’,” the Treasurer says.

“We will continue to closely monitor housing sector conditions and will work closely with the sector to develop further options to encourage growth.”

To complement the plan, the government will release 10,000 lots in total for new housing over the next four years in the north-west and south-west of Sydney. The government had already committed to releasing 8000 new lots, so this is effectively a 2000-lot jump.