PROPERTY

Stamp duty scrapped for first-home buyers in NSW

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With D-day for the NSW budget looming, we were expecting a few big announcements ahead of the grand reveal on June 20.

The first major measure, announced by the premier, Gladys Berejiklian, on June 1, is a response to the housing affordability issue in Sydney.

First-home buyers can breathe a collective sigh of relief: they will be exempt from stamp duty on purchases of up to $650,000.

first home buyers stamp duty nsw

They will also be able to access stamp duty concessions for properties worth up to $850,000.

But they'll still have to shop around: CoreLogic home index values for May give the median price for a house as $1.02 million and the median price for a unit as $742,900.

Although the number of buyers who need lenders mortgage insurance (LMI) is decreasing, you'll be happy to know that if you are approved for a loan with a loan-to-value ratio (LVR) over 90% you won't be charged stamp duty on the LMI costs.

There is also a measure to encourage the purchase of new, rather than established, property.

As well as the first-home buyer grant, first-timers looking to buy off the plan will be able to access stamp duty concessions so they can compete with Sydney's active investor market.

On top of penalties introduced in the federal budget, if foreign residents are looking to buy in NSW they will now have to pay more: 8% stamp duty (up from 4%) and 2% land tax (up from 0.75%).

All measures are due to come into effect from July 1.

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Steph Nash was a staff writer at Money until 2017.
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