NSW First Home Buyer stamp duty exemptions - Existing properties

Discussion in 'Property Market Economics' started by Property Twins, 1st Jun, 2017.

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  1. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    Hi all!

    Just saw this:

    "First-home buyers who are buying existing properties worth up to $650,000 will be exempt from paying stamp duty, which is currently only available for purchases on new properties."

    First-home buyers winners of new housing announcement

    Stamp duty exemptions will assist first home buyers, but may cause pressure on prices - especially lower end of the market in Sydney. On the flip side, impact rental yield as more people look to buy their own home.

    What are your thoughts?
     
  2. Cimbom

    Cimbom Well-Known Member

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    I'm not sure it would make a huge improvement given there is little at or under that price in Sydney at present. You may get a unit about a 40 minute train commute from the city for under that (say an hour all up each way)? Buyers would still need to save 70-100k as a deposit too.

    We were considering staying in Sydney and with our max budget of ~700k, couldn't find anything we saw that much value in and felt confident about buying at that price point.

    It is still very expensive and the boom in Sydney has made many lose perspective about prices and what the $$$ actually mean.

    It's also a bit irresponsible to be encouraging young buyers to make their first purchase at the height of a boom. The areas that will qualify for this exemption would be among the first to be impacted in the event of a correction.
     
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  3. JohnnyS

    JohnnyS Member

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    When is this effect taking place?

    As a soon to be first home buyer ( 2 months) it would suck if i missed out on this exemption.
    Any word on an implementation date?
     
  4. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    @Cimbom - agreed, definitely not great timing given the current state of the market.
     
  5. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    @JohnnyS
    I believe further details will be released today.
     
  6. Propertyman

    Propertyman Well-Known Member

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    If someone has never owned a PPoR yet has a few investment properties, does anyone know if they are still eligible?
     
  7. Biz

    Biz Well-Known Member

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    When are people on this forum going to understand that not everyone travels into the CBD for work. I don't even know one person who travels into the CBD for work! Plenty of properties available under $650k for first home buyers. Apartments galore at those prices and small houses north and south west. Just the types of properties first home buyers should be targeting. They need to save up 65k to get a foot in the door, not that hard if they are willing to work hard and sacrifice.
     
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  8. Biz

    Biz Well-Known Member

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    Here are some examples:

    Nice tidy house, St Clair, @skater would have you over for a cuppa : 4 Denver Road, St Clair, NSW 2759 - Property Details

    Apartments, Marickville, perfect for the smashed avo aficionado OUT THEY GO, Under 650k: Marrickville, NSW 2204 Sold Apartment & Unit Prices & Auction Results

    Apartments, Mosman, rub shoulders with the wealthy, live the good life: Mosman, NSW 2088 Sold Apartment & Unit Prices & Auction Results

    Moooaaar apartments, Bondi, where the effluent meets the affluent: https://www.realestate.com.au/sold/...0-in-bondi,+nsw+2026/list-1?source=refinement
     
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  9. Cimbom

    Cimbom Well-Known Member

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    I do and so does everyone in Sydney that I know in the 11 months I've been here so that is my frame of reference. Prices are generally also based on distance from the city (in most instances, unless it's near a beach or something) which is why I used it as a metric.

    I'm sorry but if I was a first home buyer, I wouldn't be looking to fork out 600k for an old two bedroom unit in say Bankstown and be paying that off for the next 20 odd years. I get that many people here have made good profits in Sydney but you need a reality check if you think that represents any kind of real value relative to pretty much everywhere else on the planet.
     
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  10. Cimbom

    Cimbom Well-Known Member

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    Lmao, St Clair? I'd rather commute from Canberra thanks - probably only takes an hour more :rolleyes:
     
  11. Biz

    Biz Well-Known Member

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    Oh, I totally understand and that's why they never get on the ladder. Not willing to do the hard yards and take less at first to get ahead. I think we call it delayed gratification around here.

    [​IMG]
     
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  12. Cimbom

    Cimbom Well-Known Member

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    Cute pic. More like help you get ahead when you sell it to them :rolleyes:
     
  13. Biz

    Biz Well-Known Member

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  14. Air_Bender

    Air_Bender Well-Known Member

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    Foreign investors are being hit as well. Interesting.

    The Foreign Investor Surcharge Duty will be doubled from 4 per cent to 8 per cent from July 1, while the annual land tax surcharge on foreign buyers will rise from 0.75 per cent to two per cent a year. The measures are expected to raise $2 billion over the next four years.

    The latest property investment data shows that one in every 10 buyers in NSW is a foreigner and, since its introduction in the 2016-17 Budget, the FIS has collected $150 million from 3000 foreign buyers.

    Mr Perrottet hinted earlier this year at possible changes to help first-home buyers, saying: “The great Australian dream is to own your own home. While foreign investment brings an important flow of capital into NSW, my priority is to ensure Australians have that opportunity first.”

    The changes will make NSW the toughest state on foreign buyers, The Daily Telegraph reports.

    Victoria has a 1.5 per cent land tax surcharge for foreign investors.
     
    Last edited: 1st Jun, 2017
  15. Air_Bender

    Air_Bender Well-Known Member

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  16. jodes

    jodes Well-Known Member

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    @Biz these are all well and good but most of these (if not all) in the Marrickville/ Mosman/ Bondi list are under 50m2 (or even under 40m2) which makes it increasingly difficult to buy.
     
  17. Redom

    Redom Mortgage Broker Business Plus Member

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    Similar to VIC change.

    Policy wise its not the smartest idea (demand push factor), but the politics of it are near necessary. Their adding to demand on fixed stock supply that generates little/no economic activity (building new homes is a job creator, hence why all states tightened these policies to new homes in the first place).

    IMO they should consider upping the threshold, $750k sounds more reasonable.

    A large % of jobs are concentrated in Sydney's CBD corridor relative to where the population lives. There's also a large % of job creation happening there. The disparity between job numbers and where affordable housing is (i.e. the west), is an area of attention. Western City cities deal will focus on this and come up with proposed solutions (airport plans, job creation plans, etc, etc).

    Not every first home buyer wants to live in the west, likely away from areas of employment.
    They also don't always want 1 bedroom studios/homes without garages.

    Would be better to have a principle based approach to working the threshold.

    Target market:
    • Family with 2 kids, working in the city
    • Young people (who accept 1 bedders)
    What you want:
    • Ability to purchase 2-3 bedroom dwellings available within 20 mins to CBD.
    • Ability to purchase 1 bedroom units very very close (5-10 mins).
    What threshold do you need to have both sets of consumers be able to access this?

    $650k works in every city. Except Sydney. You may find the odd dwellings that fit this profile, but its few and far between.
     
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  18. Biz

    Biz Well-Known Member

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    And yet...people are buying them...getting a foot on the ladder.
     
  19. Cimbom

    Cimbom Well-Known Member

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    Well said and a reasonable view which is nice to see on here occasionally.
     
  20. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    Further details in SMH:

    Stamp duty reforms for first home buyers in NSW announced

    First home buyers of existing and new properties costing up to $650,000 will be exempt from paying stamp duty and will receive stamp duty concessions for properties worth up to $850,000 from July 1 under reforms announced by Premier Gladys Berejiklian to improve housing affordability in NSW.

    As well, stamp duty charged by banks on lenders' mortgage insurance - often required by banks lending to first homebuyers with limited deposits - will be abolished.