There’s been a flurry of political announcements regarding housing of late.
Last month the NSW Government announced measures to help first home buyers. The NSW Opposition also announced, among other things, it would require 25 per cent of properties on rezoned government land be designated as affordable housing. The May Federal Budget contained a range of positive measures across the housing spectrum from first home buyers to private rental to affordable housing and homelessness.
The broader focus on housing by governments is welcome. But are they the priority measures and how do they fit together?
The NSW Government’s announcements are largely for first home buyers. There will be more than $1 billion of stamp duty concessions. First home buyers of properties costing up to $650,000 will be exempt from the duty from July 1. Buyers of first homes worth between $650,000 and $800,000 will receive stamp duty discounts. Stamp duty charged on lenders’ mortgage insurance will be abolished. The $10,000 first home owner grant will still be available to first home owners building a house worth up to $750,000. For those buying a new home the grant is available for homes worth up to $600,000.
Stamp duty concessions for properties bought off the plan, the $5000 new home grant scheme, and the ability for investors to defer payment of stamp duty for 12 months have all been abolished. This is designed to help first home buyers compete with investors. To help fund the package, the stamp duty surcharge for foreign investors will double to 8 per cent and the land tax surcharge will rise to 2 per cent.