What Does The NSW Stamp Duty Exemption Mean For You?
A collective sigh of relief came from individuals across the state on Monday 27 July. The NSW Government announced that it would be introducing the NSW Stamp Duty exemption for newly-built homes purchased under $800,000. Here is a quick recap of what it’s all about:
Starting August 1, three new changes are to be made to the stamp duty thresholds for 12 months.
- The original stamp duty exemption threshold of $650,000 for newly-built houses will be increased to $800,000.
- The stamp duty concession threshold for newly-built houses will be increased from its original $800,000 cap up to $1,000,000.
- The stamp duty exemption for vacant land will also be increased from $350,000 to $400,000. While concessions will be in place for land that costs up to $500,000.
How do you benefit as a first home buyer from the stamp duty exemption?
The stamp duty exemption threshold increase could see buyers in the market save $10,445 in stamp duty for a newly-built house costing $700,000; and $31,335 for one costing $800,000. With less up-front costs and quicker market entry, this means that those who had already saved money to cover for stamp duty can now put that amount towards their house deposit to lower repayments and lenders mortgage insurance (LMI).
Can you use the exemption with other government schemes?
You can use the NSW stamp duty exemption with other government schemes. If purchasing a new property valued under $600,000, or building a new home worth $750,000, you can reap the benefits of the stamp duty exemption along with the $10,000 First Home Owner Grant (FHOD). Strategically planning your purchase means benefitting from the likes of the $25,000 Home Builder Grant or the First Home Loan Deposit Scheme. This could save you tens of thousands of dollars.
Following the state’s Covid-19 lockdown earlier this year, the reported sales of newly-built homes dwindled. The NSW Government hopes by introducing these exemptions; it will benefit 6,000 first home buyers, boost new property sales, and keep the construction industry and workers afloat.
With historically low-interest rates, increased threshold exemptions and various schemes, now might be one of the best times to purchase; or at the very least begin to consider doing so.
Disclaimer: The information provided is general and does not constitute financial advice. Please speak to us for recommendations on personal circumstance and requirements.