Stamp duty & discounts
Stamp duty will be abolished for first-home buyers purchasing a property valued below $600,000. From July onwards, discounts will also be available for property purchases between $600,000 and $750,000 on a sliding scale, regardless of whether they’re new or established homes.
Treasurer Tim Pallas said the government’s stamp duty changes would help an estimated 25,000 Victorians purchase their first homes.
“We promised we would tackle housing affordability and that's exactly what we are doing,” he said. “Many people aren't looking for mansions. They're just looking for that first step on the ladder so they can get …a roof over their head, so that they can plan for their family's future.”
Tax on vacant residential property
The government will introduce a new tax levied at 1% on vacant residential property in Melbourne’s inner and middle suburbs.
Owners of such properties will be encouraged to make their vacant properties eligible for purchase or rent. Exemptions will be made if the property in question is a holiday home or if the owner is overseas.
“This will send a really strong message to people that if you are effectively banking an empty property and denying that to the market and contributing to the lack of supply, then there's something you can do about it,” Premier Daniel Andrews said. “You can simply pay the tax or you might go see a real estate agent.”
Co-ownership plan
Meanwhile, in a move aimed at assisting people who can afford the mortgage payments but lack a down payment, the government has announced a new co-ownership plan.
As part of a pilot scheme valued at $50m, the government will purchase up to 400 homes, taking a 25% share in the properties. This way, aspiring first-home buyers won’t need such a large deposit and can enter the market sooner.
Eligible applicants need to earn $95,000 a year for couples and $75,000 a year for singles.
Other reforms
Last week, the Andrews Labor government announced that 100,000 housing blocks would be rezoned to be made available for sale, creating 17 new suburbs in Melbourne’s key growth zones.
Also last week, the government said the First Home Owner Grant (FHOG) would be doubled in regional Victoria (from $10,000 to $20,000, starting on 1 July). This will help thousands of Victorians purchase their first home.
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