Deposit in your pocket
The NSW Government’s recent announcement will grant first home buyers a stamp-duty exemption and fix the heart of the struggle for young buyers – saving a deposit.
The exemption has the ability to save home buyers up to $34,360 in tax – which can go directly into their deposit savings. There is also an exemption from the stamp duty on lenders’ mortgage insurance – an insurance often imposed on those with smaller deposits. This may save first home buyers nearly $3,000 in additional charges.
The difficulty in saving a deposit has repeatedly been highlighted as the major hurdle for first-time buyers, with multiple financial outlets identifying deposit struggles as the major deterrent to people entering the market.
The announcement ensures a full exemption from stamp-duty for houses under $650,000, with a sliding exemption for houses valued up to $800,000.
This is a huge windfall for young people in the regions, where housing prices are lower, with the median house price in regional NSW at $365,000.
This means your average home – not a unit or semi-detached – is $677,000 cheaper than one within the Sydney city-circle (encompassing the Inner West, Eastern, City and Lower Northshore suburbs) and $411,000 cheaper than one on the outskirts of the city, where people can often commute up to four hours a day, on crowded public transport, just to get to and from work.
There is also a $10,000 grant available to first home buyers wanting to build or buy a brand new home.
This means regional first home buyers who want to stay in the regions, work in the regions and build a life in our wonderful regional communities are guaranteed to benefit from this stamp-duty exemption.
Strong growth in housing returns in regional Australia of 4.3 per cent mean not only can first home buyers can not only invest in their lifestyle by buying outside the cities; they are also investing in their future.
The stamp-duty exemption is expected to help 24,000 young people enter the property market.
NSW Rent and Sales Report, September 2016
For more information, go to https://www.nsw.gov.au/improving-nsw/projects-and-initiatives/first-home-buyers/