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Stamp Duty Concession Lowered to $430,000 in Another Blow to First Homebuyers

08 May 2014
FIRST homebuyers of established properties have been hit in the Budget, with the stamp duty levy threshold lowered from $500,000 to $430,000.
Stamp duty is not levied in WA on the first $500,000 spent on a first home purchase, but that threshold will now drop to $430,000 in the State Budget.
Treasurer Mike Nahan also announced a 10 per cent across the board increase in land tax. Last year’s budget saw land tax rise 12.5 per cent.
It comes after the Barnett Government last September slashed the First Home Owner Grant for people wanting to buy established properties by more than half to $3000.
A stamp duty exemption on new house and land packages remains unchanged.
To be eligible, the value of vacant land must not exceed $400,000 and no duty is paid on land under $300,000.
Last August, the first owner grant for those wanting to buy a newly built home or building a new home increased from $7000 to $10,000.
Those liable for land tax have residences which are not used as their primary residence, such as investment and business properties.
Dr Nahan said the market for established homes was “quite hot” and there had been “rather rapid growth” in the first home buyers market.
The Treasurer said the State Government’s focus was on encouraging the construction of new housing stock, not driving up property prices.
He said the government was “reorienting” its first homebuyer schemes to encourage people to buy home and land packages rather existing homes.
REIWA president David Airey said the budget was fairly disappointing for first-time home buyers.
Mr Airey said that last year’s land tax hike was a kick in the shins, and the latest hike moved the boot up a little higher.
“The drop in the stamp duty concession for first home buyers may mean half of first home buyers will pay stamp duty,” he said.
“At the medium price for first home buyers, of $460,000, that stamp duty will amount to $5700, wiping out the benefit of the first home buyers grant.
“This will slow down housing market activity, it will subsequently slow down stamp duty revenue as a result.
“The government have, in my view, bitten off their noses to spite their face.”
Master Builders director of housing, Geoff Cooper, said the Budget would make the housing affordability crisis in WA worse.
“This is the tax man putting his hands in the pockets of WA homebuyers,” he said.
 

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