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Lost Concessions Increased Land Tax And Stamp Duty Changes For Homeowners

To help ease pressures caused by cost-of-living increases, first-time buyers schemes are being expanded. But, as one hand gives, another takes away for off-the-plan buyers in Victoria who will lose money-saving concessions for off-the-plan purchases.

It's more than a week since governments and lenders introduced a range of 1 July changes impacting home buyers to ring in the current financial year.

Make yourself at home with friends, family and siblings

The changes mean that some buyers entering the market will benefit from a little financial relief, thanks to the decision to allow friends, siblings and other groups of family members to jointly apply for the First Home Guarantee and Regional First Home Buyer Guarantee.

Even people who have bought homes before can apply, as long as they have not owned property during the last 10 years.  Within the 2023/2024 financial year, there will be 35,000 new places for first homeowners and 10,000 for regional buyers. 5000 places are allocated under a single parent program.

But before you sign up, it's recommended that you check the fine print - carefully! - to explore whether the lender you lock into as part of the scheme will charge a higher interest rate.

Since 1 July, Westpac and RAMS Home Loans have come on board as lenders, so there is, at least, a couple more choices.

Lost concessions impact Victorian home-buyers

Victorians have had some other money-saving options reduced with the news that off-the-plan buyers will lose concessions - and that means that buying costs will likely increase sharply.

The Victorian Government's decision to reduce off-the-plan stamp duty concessions means that properties worth up to $1 million (that were previously eligible for concessions) are now (as of 1 July) not eligible. Instead, the threshold is set at $750,000 for first home buyers and $550,000 for other buyers.

Changes to stamp duty and increased land taxes

Depending on where you are in Australia, the 1 July changes mean different things for your planned property purchase - and the ongoing affordability of property already owned.

NSW’s first buyer stamp duty exemption has officially changed from 1 July.

For home buyers buying properties worth up to $800,000 (previously $650,000) stamp duty won't apply in NSW. Properties worth up to $1 million (previously $800,000) will attract a discount. There is a new requirement to live in the property being bought for a minimum of 12 months instead of six months (the case for the first homeowner grant and other schemes).

Then there's land tax across the country - and in many places that's changed from 1 July too. First home buyers in NSW, have can wrap their heads around the news that the scheme allowing first home buyers to choose between paying stamp duty and an annual land tax ended on June 30.

In the ACT, Queensland, South Australia and Western Australia, land taxes are on the move - up.

If you're a Victorian with a second home or investment property, your new flat-rate tax of up to Victorians $975 (plus an additional levy on the land value) needs to be paid from 1 January. NSW property owners need to put the same land tax payment date on their calendar too.

The bottom line:

Although there wasn't a rise from the RBA last week, more are expected. And with more banks cutting cashback deals on home loans and these latest new financial year changes, it's time to crunch those numbers carefully and seek professional advice to properly understand your options. Whether it's a smart move to buy now or wait to see how these changes and ongoing interest rate evolutions pan out in the next several months is up to you. But doing your due diligence and understanding what's one offer (and what's being taken away) can help you make an informed decision.

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Financial disclaimer

The information contained on this web page is of general nature only and has been prepared without taking into consideration your objectives, needs and financial situation. You should check with a financial professional before making any decisions. Any opinions expressed within an article are those of the author and do not specifically reflect the views of Compare Club Australia Pty Ltd.