October 25th 2020
Victorian home buyers are the BIG WINNERS following the announcement of their State Budget for 2020-21.
There is no denying that the Victorian state economy has taken a battering during the coronavirus pandemic. In response, the Victorian Government are offering stamp duty discounts plus an additional spend of almost $50 billion on other concessions, subsidies and projects. Will this be enough to get hundreds of thousands of people back on their feet and back to work? Only time will tell.
What are the stamp duty discounts?
To stimulate the property market, the Government have made the following commitments:
- Savings of up to 50 per cent of stamp duty on newly built or off-the-plan homes valued at up to $1 million, will be offered until June 30 next year.
- Existing homes will be eligible for a 25 per cent waiver. A first home buyer, purchasing an existing home worth $700,000, would be eligible for both the first home buyer duty concession and then the new 25 per cent waiver, totalling tax relief of some $18,500.
- A 50 per cent stamp duty concession will also apply to the purchase of commercial and industrial properties in regional Victoria.
What else is planned to stimulate the property market?
- For First Home Buyers these discounts would also coincide with the existing FHLDS (depending on spaces available) and the Home Builder Grant of $25,000 (as long as contract is entered into before 31/12)
- FIRST HOME OWNER GRANT: For Regional Victoria, this has been extended to $20,000 for contracts entered into before 30/5/2021
- A $500 million Victorian Homebuyer Fund will be launched to help people who do not have a 20 per cent deposit buy homes. The fund will contribute to the purchase price in exchange for equity in the property.
- The Government hopes a 50 per cent land tax discount to be introduced from 2022 will attract new investment in build-to-rent developments and boost housing supply by about 5,000 homes.
What now for home buyers…?
There is little doubt that the Budget’s stamp duty discounts will stimulate the property market BUT it is also possible that they will inflate property prices and exacerbate problems with housing affordability.
With interest rates at an all-time low and the recently announced stamp duty discounts – on top of other grants and packages that may be on offer to you – it could be worth making a move on to, or up, the property ladder sooner rather than later!
Are you a home buyer who could do with some support navigating the home loan process? Contact Bernadine for a chat today!