The major victors under a targeted stimulus plan, which removes stamp duty on newly constructed houses under $800,000 and cut thousands of dollars for homes valued for up to $1 million are first home buyers and the construction sector, in general.
As part of the government’s COVID-19 Recovery Plan, the change in stamp duty ceiling is boosting housing construction across NSW and create jobs in the construction industry.
The changes include increasing the threshold at which stamp duty is to be paid for new homes for first home buyers from $650,000 to $800,000, with the concession declining as prices increase before being eliminated at $1 million.
The government expects that the changes is likely to benefit over 6000 first home buyers, with eligible applicants getting thousands of dollars in savings.
In addition, the stamp duty threshold on vacant lots has increase from $350,000 to $400,000 and is removed at $500,000.
The new rule only covers newly constructed home and vacant lots, not existing properties, and is valid for 12 months, starting from 1 August 2020. Existing schemes will continue to be applied for other purchases.
According to Treasurer Dominic Perrottet, the stamp duty savings for first home buyers amount to is no less than $31,335 on a new home valued at $800,000.
Since July 2017, over 93,000 first home buyers have benefitted from the existing scheme, and the building sector will get added support as the country confronts the challenges of the current health crisis.
Other NSW government schemes also continues to include a $10,000 First Home Owner Grant, which is open to first home buyers eyeing a property worth no more than $600,000, or purchasing a lot and constructing a new first home valued at no more than $750,000.
This means a first home buyer should expect to benefit a maximum amount of $32,335 if they are buying a new property and being eligible for the grant.
Indicative tax threshold changes:
|Property Type||Existing stamp duty amount for eligible first home buyers||New stamp duty amount for eligible first home buyers||Saving|
|Vacant Land $350,000||$0||$0||No change|
|Vacant Land $400,000||$0||$0||$7793|
|New home $650,000||$0||$0||No change|
|New home $700,000||$10,445||$0||$10,445|
|New home $800,000||$31,335||$0||$31,335|
|New home $900,000||$35,835||$20,168||$15,668|
|Existing home $650,000||$0||$0||No change|
|Existing home $800,000||$31,335||$31,335||No change|