By Anthony Webb
The Victorian Government has revealed that stamp duty for new homes will be reduced by 50 per cent under a new move announced in the state budget on Tuesday.
Those purchasing newly built homes valued up to $1 million are eligible for the full discount until June 30, 2021. Those purchasing existing homes will receive a 25 per cent discount on stamp duty, up to the same value.
It’s fantastic to see this incentive from the government. Reducing the burden of this hefty tax will get more home buyers into market, and increase housing affordability for everyday Victorians. The sub-$1 million market is currently going strong, and this incentive will only continue to drive demand.
The targeted initiative is also likely to encourage downsizers to move into something smaller, therefore stimulating the market by freeing up larger and more expensive housing stock.
Whilst this move falls a little short of the announcement made by the NSW government last week (proposing an opt-in, opt-out stamp duty which could be replaced by a cheaper annual land tax) it is still a fantastic initiative that will stimulate the market and help more Victorians get into homes before June 2021.
Hopefully this test run reveals to the government that ditching stamp duty (or at least providing an alternative land tax) would be a gamechanger for Victoria’s housing industry in the long-term.