Governments can and will change their minds, every move they make changes the way you play the game. It creates winners and losers, and out of that comes opportunity.
The Labor party intends to introduce legislation into NSW Parliament as of the end of May, in an effort to ease the financial burden for First Home Buyers. The legislation will provide relief for 5 out of 6 First Home Buyers who purchase after Saturday, 1st July 2023, after the current First Home Buyer scheme ends at the end of this financial year.
Changes to Stamp Duty in NSW will see First Home Buyer properties between $650,000 to $800,000 will now pay $0 stamp duty, saving up to $31,090 in the process. Stamp duty concessions will then be applied to purchases of property between $800,000 and $1 million dollars, however those who purchase within this bracket will still experience significant savings on stamp duty (up to $23,318 can be saved). See table below for thresholds and new stamp duty amounts.
As for first-home buyers purchasing between the range of $1m and $1.5m, they can opt for land tax payment as opposed to stamp duty until the end of June, in other words if you are a seller in this range it is a great time to sell now!
Finally, the requirement to live in a home will be increased from 6 months to 12 months, in a further effort to improve the integrity of the program.
The threat of rent caps and further capital gains changes see many running to the banks for a fixed rate of return without the risk. Sure, there’s no capital growth, but there’s a good rate of return without the risk of further policy changes. Australian Prudential Regulation Authority is considering changes to the assessment rate, which will take fixed-term borrowers out of mortgage prison and into the opportunity to refinance.
Governments rarely focus on supply, instead playing with demand through first-home buyer grants, incentives and discounts. Even in a time of housing affordability or rental crisis, there’s active encouragement for anyone to sell!