21 June 2024

ACT Budget: Homebuyers to save thousands with sweeping stamp duty cuts

| Ian Bushnell
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row of townhouses

The changes aim to capture more properties and offer more generous income thresholds. Photo: Ian Bushnell.

The ACT Budget will include sweeping stamp duty cuts to make it easier for people to buy a home, a move that could ease pressure on Canberra’s tight rental market and also woo voters come October.

The cuts include extensions of existing schemes for first-home buyers, off-the-plan purchases, people with a disability and pensioners.

The government has also supported its planning incentives for more dual occupancy developments in the suburbs, which have had a poor take-up so far.

It says first-home buyers will save tens of thousands of dollars.

READ ALSO Government aims doubling of 2024-25 land release at units and townhouses, and first-home buyers

Eligibility for the full stamp duty concession in the Home Buyer Concession Scheme will be extended to the first $1 million of property value, saving first-home buyers up to $34,000 in tax when purchasing their home.

From 1 July, the income eligibility threshold will rise to $250,000 a year for homebuyers who have not owned a property in the previous five years, up from $170,000 a year for homebuyers who have not owned a property in the previous two years.

Home buyers will also be able to earn an additional $4600 per child, up from an additional $3330 per child.

People fleeing family violence will be exempt from the requirement to have not owned a property in the previous five years.

The stamp duty concession for off-the-plan unit purchases will be extended temporarily from 1 July 2024 to include properties valued up to $1 million, up from $800,000 in 2024-25, so more Canberrans can purchase an apartment or townhouse.

This coincides with a big increase in land releases in 2024-25, predominately for townhouses and multi-unit development.

The government also wants to encourage more people to take advantage of planning changes that allow dual occupancy developments on large suburban residential blocks over 800 square metres.

The stamp duty exemption on the first transfer of unit-titled dwellings introduced when the planning rules changed will be temporarily extended to include properties valued up to $1 million in 2024-25 to align with the Off-The-Plan Unit Duty Exemption.

The RZ1 Unit Duty Exemption Scheme runs until 30 June 2026.

This planning change is designed to unlock more suburban land for housing and assist people to downsize in the suburbs where they have lived for many years.

For people with a disability, the existing Disability Duty Concession Scheme will provide from 1 July a full stamp duty concession on the first $1 million of property value.

Previously, the scheme was limited to properties valued up to $1 million, so a partial concession will now be available for properties over that mark.

The government is also introducing a new Severe Disability Duty Exemption from 1 July 2025 to support people with a severe disability and their carers to find a home.

This will exempt homes bought by people with severe disability or their carers from stamp duty if the home is their principal place of residence, without requiring the home to be bought by a Special Disability Trust.

READ ALSO Government flags ban on sale of gas appliances, climate-positive upgrades to public and community housing

Pensioners will be supported to downsize with the Pensioner Duty Concession Scheme, extended from 1 July 2024 to provide a full stamp duty concession on the first $1 million of property value. A partial concession will be available for properties over $1 million.

The existing scheme provides a full stamp duty concession for homes valued up to $550,000, with a decreasing concession to zero for homes valued between $550,000 and $765,000.

ACT Chief Minister and Treasurer Andrew Barr said the new and expanded stamp duty concessions and exemptions would help more Canberrans find a home that suits their needs.

“We know stamp duty can be a significant barrier to home ownership. That’s why we have cut stamp duty in every ACT Budget since 2012, and this Budget continues that work,” he said.

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So less revenue and less money to spend on infrastructure.

When will governments learn that any concessions or subsidies go straight to the home seller by increasing buyer’s purchasing power and hence increasing prices above where they be otherwise.

Yeah a bit like the Fed Govt $300 electricity bill rebate. As soon as it was annouced the electricity companies increased their prices

I doubt if they will learn while ever they have investment properties

Victor Bilow1:03 pm 22 Jun 24

The obnoxious ACT Government . Next, Increased rates are on the way as has the large electricity and water hikes the ACT government has coming. ActewAGL’s ACT electricity prices will increase on average by 12.75% for residential and small business customers and Barr and his cronies said this high increase would not happen in the ACT. GST was supposed to replace all other taxe’s so they invented stamp duty, etc and every other fiddle possible.

My solar feed-in rate is decreasing from 10 cents down to 8 cents come 1st July.

Yes, that 100% renewable scam makes prices only go in one direction

devils_advocate9:54 am 22 Jun 24

The stamp duty concession for off-the-plan townhouses would be rendered useless by the punitive Lease Variation Charge

How does this relate to the phased replacement of stamp duty with land tax? Do those who take advantage of immediately go to the full rate of land tax that will apply once stamp duty is eliminated? If so, give with one hand take with the other. If not, just another demand-side “solution” to a supply-side problem.

Stamp duty is suppose to be replaced by an increase in Rates (which they are currently “double dipping”), not Land Tax

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