Browse all categories | Subscribe My Account | Logout
Browse all categories
< Back

Stamp duty cuts making things harder for some first-home buyers

Property Markets / Planning, Zoning, Infrastructure

Apr 15 2018

Add to Favorites

Share this Article:

Stamp duty cuts made by the Victorian and NSW government last year to help first home buyers are having the opposite effect, pushing house prices higher. 

The stamp duty change eliminated the transaction tax on homes worth up to $600,000 and cut it on prices up to $750,000, however it has worsened the situation for some first home buyers. 

On Friday, the NAB predicted a national fall of 0.8 per cent in house prices, reversing its earlier expectation of 0.7 per cent gain.

But Ms DeBondt-Barker said in Melbourne, while prices have flattened in blue-chip areas, the picture was very different in more affordable suburbs.

"If you go to Epping, Werribee, Tarneit, Cranbourne – Frankston's gone nuts – if you go to the outer suburbs, the only ones first home buyers can get into now, it's absolutely soaring and is still going up," she said.

While the change will save money for some buyers, when combined with other policies such as first home buyer grants, the result is that the first group of buyers have more money to offer vendors, pushing the overall market higher for subsequent buyers.

ANZ data shows that since July 1, properties in the lowest-priced quartile of Melbourne's housing market have jumped 9 per cent, compared with a gain of just under 3 per cent for Melbourne market as a whole.

In Sydney, where higher prices have meant the stamp duty thresholds affected a smaller number of properties, the effect was similar. While the greater Sydney market has fallen 3.2 per cent since July 1, dwellings in the lowest-priced quartile have held their ground.

But Victorian Treasurer Tim Pallas said the tax reforms had worked.

"The real story here is that our reforms are saving first home buyers thousands of dollars and helping them break into the housing market, with almost double the amount of first home buyers accessing a stamp duty exemption or concession than for the corresponding period in the previous year," he told the Australian Financial Review. 

Photo by Jamie Davies on Unsplash




You may also like...

Load More


Login into your MP Report account

Forgot my password

Sign up to the MP Report

Creating an account with MP Report allows you to save articles and update your preferences to filter the content based on your interests and what content you would like to receive from us via our email alerts and newsletter.