Stamp Duty Policy by ALP can Convince First Home Buyers to Invest more…
According to state opposition leader Luke Foley, “First home buyers in NSW are allowed to pay stamp duty over five years”. This may cause the first home buyers to invest more in the property.
Sam Elbanna of CPM Realty said, “On an $800,000 property, they might have to pay $30,000 in stamp duty which they’d be, in effect, getting an interest-free loan from the State Government”.
He further added,”Then they could start thinking they can afford to buy something that’s $830,000 instead and increase the heat in the market? Exactly the effect that the Government is trying to avoid. I think they have to come up with a better solution.”
On the other hand many in the real estate industry cautiously welcome the instalment plan, they do not think it will be enough to significantly help first home buyers into the housing market.
Many said it would be of more practical use to raise the thresholds on which different rates of stamp duty are payable to keep pace with the hike in property values of the last two years.
Tim McKibbin – Chief executive of Real Estate Institute of NSW said, “Anything that helps first-home buyers or property consumers has to be welcomed, but I think the first thing the government needs to do is look at the bracket creep”.
He further added, “It was extremely tough for first-timers to have to come up with the cash for stamp duty on top of the cost of their acquisition, so it would be good if they had more time to pay it, that concept does have merit, but the brackets were set when property was worth far less, so we need to do something about that now.”
Director of Colliers International Ian Bennett said, “First-time buyers of new property are exempt from paying stamp duty on homes priced $550,000 or less, or have concessions on stamp duty from $550,000-$650,000, so the opposition leader’s proposal would have little impact on them”.
Mr Elbanna said,” It would be more valuable to see those limits on the First Home-New Home scheme rise. It makes sense to increase those figures from $550,000 and $650,000 to $900,000 or a million dollars”.
Alan Byrnes, principal of Ray White Randwick said, “But anything in the short-term to help first-home buyers should be welcomed. Things are very tough for them, especially after the old first-home buyers’ grant [on buying established property] was taken away. It gets the thumbs-up from me”.