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Under the government’s First Home Buyer Choice scheme, eligible first home buyers will have the choice of a smaller annual property payment or a traditional upfront payment for properties with a purchase price of up to $1.5 million.
Legislation for the First Home Buyer Choice was announced in the 2022–23 NSW Budget as part of the government’s integrated $2.8 billion housing package and is hoped to be introduced into Parliament this week.
While the stamp duty reform is not yet legislated, advocate Premier Dominic Perrottet has put forward the online calculator in a bid to forge ahead and assist first home buyers in making a decision.
Mr Perrottet said choice was “central to this game-changing reform” and will help put keys in the hands of more new home owners sooner by shaving years off the time it takes them to save for a deposit.
“Home ownership is the investment that starts paying dividends from the moment you walk through your front door for the first time and we don’t want people to have to wait an extra couple of years to reap those benefits,” Mr Perrottet said.
Given half of all owner-occupiers sell their home within 10.5 years, with first home buyers likely to sell even sooner, Treasurer Matt Kean said the property payment tax would allow them to pay less overall.
“First Home Buyer Choice will help young families take their goals of home ownership into their own hands and fast-track their journey to the great Australian dream.”
The state’s peak business organisation, Business NSW, is calling on the NSW Parliament to support the “critical reforms”.
Business NSW CEO Daniel Hunter said by providing first home buyers a choice between stamp duty and an annual levy, there is “no doubt this measure will help more of our kids get the keys to their first home”.
Business NSW’s most recent Business Conditions Survey, which was completed by 1,118 businesses, revealed that 62 per cent of respondents supported the scheme.
“Stamp duty is an inefficient tax and drives poor outcomes when it comes to housing affordability and mobility of families and workers who are reluctant to move when faced with another stamp duty fee,” Mr Hunter said.
“We also know that it takes around two years to save stamp duty on top of a deposit, placing an unfair burden on first home buyers.
“By providing a choice, a potential first home buyer can sit down and calculate which option is best for their circumstances, with many to be better off choosing an annual property levy rather than an upfront stamp duty.”
Indeed, given the escalating house prices, tax reform won’t solve the ongoing housing crisis by itself, but Mr Hunter said when combined with supply side measures it was a step in the right direction.
[Related: NSW stamp duty reform is limited: Proptrack]
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