First home buyers, eligible pensioners and farmers are set to start receiving the 50% reduction in the stamp duty they pay when purchasing a home. The cuts are part of the state government’s election promise made last November and are due to take effect from July 1.
Real Estate Institute of Victoria figures show that house prices have more than doubled since the First Home Owners Grant was introduced back in 2000. However, for most buyers of a first home the financial assistance is still only $7,000. Victorian’s pay the highest levels of stamp duty in the country, with the average $565,000 Melbourne home attracting stamp duty of almost $29,000.
The new stamp duty savings will be worth around $5,794 on a home valued at $565,000. The additional $5,794 benefit, when added to the continuing grant of $7000, will lift overall assistance on an average home to around $12,794. People buying a new home will also benefit, as the bonus of $13,000 in the metropolitan area and $19,500 in regional areas will continue and now be boosted by the stamp duty cuts.
Most experts welcome these changes but many are concerned that these cuts do not go far enough. It remains to be seen if any further reductions in stamp duty costs are introduced for all property buyers.
