Victorian Budget: Homeowners get a massive stamp duty discount

Victorian Budget: Homeowners get a massive stamp duty discount

Victorian Budget: Homeowners get a massive stamp duty discount

Stamp duty cost will be reduced by up to 50 per cent in Victoria as unveiled in the latest state budget. This is expected to provide enormous savings for homebuyers, which in return, will stimulate the property market until June 30 next year.

The full 50 per cent discount will only be applicable to newly built homes valued up to $1 million. Existing homes will get a 25 per cent stamp duty discount of the same value.

The slashed stamp duty costs will equate to discounts of up to $27,500 for 50 per cent and up to $13,750 for 25 per cent.

The tax relief will apply to contracts entered into between 25 November 2020 to 30 June 2021.

According to State Treasurer Tim Pallas, the emergency stamp duty discount’s aim is to get as many people in that price bracket [$1 million] and below back into the housing market, which took a major hit during the COVID-19 pandemic.

For Danni Hunter, Chief Executive of Urban Development Institute of Australia, stamp duty is the barrier that makes people hesitant to buy a new home.

“It recognises that the construction of new housing is a really important economic multiplier and locks in jobs,” she said.

Mr Pallas shared the importance of investing in the build-to-rent sector due to its potential in providing broader choice and diversity of housing options for renters.

Ms Hunter said the move goes with other budget measures — especially a $5.3bn investment in social housing and land tax discounts of 50 per cent for developers who delivered build-to-rent housing — to create “the most comprehensive housing package in a generation”.

“Land transfer [stamp] duty is expected to recover from 2021-2022 and grow by an average of 15.4 per cent a year, over the forward estimates, but is not expected to reach the 2018-2019 level until 2022-23,” the budget papers stated.

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