The New South Wales government will temporarily reduce stamp duty on new homes for first home buyer's in an effort to boost construction and create jobs amid the COVID-19 crisis.
The changes will increase the stamp-duty free threshold on new homes from $650,000 to $800,000. Properties over $800,000 will be provided with a concession on the stamp duty phased out at $1,000,000. Furthermore, the stamp duty threshold on vacant land will rise from $350,000 to $400,000 and will phase out at $500,000.
The change to the thresholds will only apply to newly-built homes and vacant land, not to existing homes, and will last for 12-months from 1 August 2020. The state government will also continue to offer a $10,000 first homeowner grant, which is available to people buying a new first home worth no more than $600,000, or buying land and building a new first home worth no more than $750,000.This means the maximum benefit a new home buyer could be entitled to is $32,335 through the grant and stamp duty saving.
To qualify as a first home buyer, you must be purchasing the first home you or your spouse have owned or co-owned in Australia, although there are some exceptions.You must also move into the property within 12 months, and live there for at least six continuous months.
The Australian Government has also announced HomeBuilder to provide eligible owner-occupiers (including first home buyers) with a grant of $25,000 to build a new home, substantially renovate an existing home or buy an off the plan home/new home.
The eligible contract must be signed between 4 June 2020 and 31 December 2020 (inclusive). Construction need not commence prior to 31 December 2020, however, must commence within three months of the contract date. Further, construction cannot have commenced before 4 June 2020.
HomeBuilder is available to individual applicants and couples who are or will be registered as the owner on the certificate of title. Each applicant must be:
a natural person (not a company or trust)
aged 18 years or older at the date of the contract
an Australian citizen.at the date of application.
Applicant(s) must be below one of the following two income caps
$125,000 per annum for an individual based on either your 2018-19 or 2019-20 taxable income, as shown on your notice of assessment issued by the Australian Taxation Office or
$200,000 per annum for a couple based on either your combined 2018-19 or 2019-20 taxable income, as shown on your notices of assessment issued by the Australian Taxation Office.
If you would like more information or would like to understand how these changes affect your personal circumstances contact us today.