Victoria’s stamp duty discounts, which were brought in last November, have now changed, with the conditions of buying a property in Victoria now drastically different.
Damien Roylance, founder and managing director at Entourage, explained that the previously generous discounts were at an end.
“On June 30, we lost the 25% discount that began last November through Covid. Anyone who bought under $1 million got a discount on their stamp duty, but that has now finished. You had 8 months of that, which was handy for a lot of people buying, but it’s now gone.”
“What happened from July 1 is that they started to tax higher purchase prices. Anything over $2m got an extra 1% of stamp duty. The first $2m is normal, at that 5% rate, but anything over gets another 1% on top.”
The discounts should benefit First Home Buyers in Victoria, without too badly affecting those already in the market or those shopping in the higher echelons.
“The discounts looked after the more affordable properties in Victoria, and that’s your First Home Buyer market. In a way, the new rules are a rich tax: people who are buying for $2m or more have to pay an extra $10,000 per every million about $2m.”
“When you look at median house prices now, $2m doesn’t get you what it used to. It’s a pretty standard price in inner Melbourne now. The stamp duty rise in Victoria won’t deter anyone buying: if you’re spending $3m on a house, it was $165,000 and now it’s $175,000 so it isn’t going to stop you from purchasing.”
“If you’re buying at $10m, you’d pay an extra $80,000 of stamp duty, but when you’re already paying $10m, that isn’t going to put you off. It’s more tax for the government.”
With Victorian stamp duty discounts removed, there could have been a potential drop off in buying, but Damien Roylance doesn’t see that coming to pass.
“I wouldn’t say say, no,” said Roylance. “From the Macedon Ranges to the Mornington Peninsula. I follow the Flinders region pretty closely and it’s grown probably the most in the last 20 years in Victoria.”
“There was probably one house on the market there last week, and I looked yesterday and now it’s under offer, so I think people are still buying. In Macedon, if you know the area, you don’t really need to see the property.”
“It’s a block of land, you can get a feel for the house through photos and people are buying unseen. That market is still good. I don’t see that any stamp duty concessions are going to stop it right this second, especially that we are in lockdown again in Metro Melbourne.”
