New homes under $800,000 will be stamp duty-free under a state government plan to provide a “targeted boost” to both first home buyers and the construction industry as the COVID-19 crisis continues.
According to Premier Gladys Berejiklian, the change to stamp duty thresholds forms part of the government’s COVID-19 recovery plan — which will also see thousands slashed from the stamp duty payable on properties worth up to $1 million as well as vacant land.
“Thousands of people will see their bank balances benefit from this change. It will help get more keys into more front doors of more new homes,” she said.
The changes will mean the threshold above which stamp duty is charged on new homes will be bumped up from $650,000 to $800,000, with the concession reducing on higher values before phasing out at the million-dollar mark.
According to government forecasts, more than 6,000 first home buyers will benefit from the changes, which will “also boost housing construction across NSW and support jobs in the building industry at a time when we need them more than ever before”, Ms Berejiklian said.
For vacant land, thresholds will be brought up from $350,000 to $400,000 before phasing out at $500,000.
Threshold changes will only apply to newly built homes and vacant land and will only be applicable for a 12-month period, commencing 1 August 2020.
Having crunched the numbers, state treasurer Dominic Perrottet said the tax relief measure could save first home buyers stamp duty costs of up to $31,335 on a new $800,000 home.
“The current scheme has already helped over 93,000 first home buyers since July 2017, and this will give the construction industry extra support as we face the challenges of COVID-19,” Mr Perrottet said.
“We need to ensure our building sites keep ringing with hammers and saws as that means more people working, and first home owners will save money in the process.”