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The Malinauskas government has utilised its 2023–24 state budget to abolish stamp duty for first home buyers purchasing under certain conditions.
Under the new scheme, first home buyers who purchase a new home valued up to $650,000, or vacant land valued up to $400,000 to build a new home, will be free from paying the controversial stamp duty tax.
According to state Premier Peter Malinauskas, the program will remove nearly $50,000 from the cost of an average new home, a financial factor he believes will make home ownership easier and cheaper for first home buyers.
“Importantly, this will also help stimulate new supply in the market, helping ease the housing crisis for everyone, and providing a pipeline of work for an important sector of our economy,” he added.
Earlier this year, NSW’s newly elected Minns government pushed forward with their election promise to remove the controversial tax for first home buyers purchasing a home valued up to $800,000.
More recently, the Queensland government were criticised by the Real Estate Institute of Queensland (REIQ) for failing to explore similar stamp duty abolishing schemes in its state budget for next financial year.
South Australian Treasurer Stephen Mullighan said removing stamp duty at a time when first home ownership feels increasingly out of reach for first home buyers in the state will “keep dreams of home ownership alive”.
Data from the Real Estate Institute of South Australia (REISA) found the state’s median house price recently leapt above $600,000, a new record for the state.
Despite the state’s median house price matching the threshold for the stamp duty abolishment scheme, Nick Champion, the state’s minister for trade and investment, insisted “this landmark package opens the door for first home buyers and renters”.
In addition to the state’s stamp duty scheme, the South Australian budget revealed an increase to the First Home Owner Grants (FHOG) property value cap from $575,000 to $650,000.
The FHOG is a scheme available to eligible first home buyers who build or buy a new home. The government believes increasing the value cap by $75,000 aligns the scheme better with the state’s rising home values.
According to a media statement from the South Australian government, these schemes combined “mean eligible first home buyers who build or buy a new home valued up to $650,000 will now receive up to almost $30,000 in stamp duty relief as well as a FHOG payment of $15,000, bringing total relief from the state government to $44,580”.
While it is estimated the programs will cost around $147.3 million over four years, the government declared they would benefit nearly 4,000 first home buyers per annum.
Stamp duty relief comes as part of the South Australian government’s $474.4 million housing package which aims to deliver 3,600 new homes over five years and reduce the cost of housing for around 14,000 new homes.
The government’s housing package includes:
- Building an additional 564 public homes and stopping the sale of 580 others
- Fast tracking the single largest release of residential land in the state’s history – totalling more than 25,000
- 700 additional affordable homes under the National Housing Accord
- Delivering targeted reforms to rental laws including banning rent bidding
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