WA stamp duty rebate scheme slashed, but extended

Apartment consumers in Western Australia have been given an additional two years to entry stamp duty rebates for off-the-plan purchases, but the scheme has been minimize from 75 per cent to 50 per cent.

WA Premier Mark McGowan introduced the state authorities would lengthen its stamp duty rebate scheme as a part of the WA state funds, which delivered a report $5.6 billion surplus, largely pushed by an enormous carry in iron ore royalties.

The stamp duty rebates, which apply to off-the-plan purchases pre-construction and are capped at $50,000, will now be out there till October 2023.

Buyers have till October this yr to entry the 75 per cent rebates, after which period they are going to be diminished to 50 per cent.

Mr McGowan mentioned the extension was one in every of a spread of measures the state authorities had put in place to enhance housing affordability and facilitate development in development.

“We have seen enormous activity in the construction sector over the past year, which will translate to more affordable homes and more jobs,” Mr McGowan mentioned in a press release.

Industry teams have welcomed the announcement, with Urban Development Institute of Australia WA government director Tanya Steinbeck saying it might be vital to draw buyers into WA’s flats market.

“The loss of investors in WA has negatively impacted all segments within the Perth property market,” Ms Steinbeck mentioned. 

“However, it has disproportionately affected built-form builders who’re closely reliant on pre-sales in an effort to start tasks.

“UDIA absolutely supported the introduction of the rebate scheme in October 2019 and it has been demonstrably profitable in getting extra new condo tasks off the bottom and creating jobs.

“We hope that continuing the scheme will also have a positive impact on the current low vacancy rate.”

Real Estate Institute of WA president Damian Collins, nonetheless, mentioned whereas he welcomed the extension, the brand new funds missed an enormous alternative for daring reform.

“We welcome the investment in social housing to help address the state’s housing shortage, however, more needs to be done to increase housing supply in the private rental market,” Mr Collins mentioned.

“The non-public sector supplies the overwhelming majority of housing and points reminiscent of stamp duty, in addition to the present assessment of the Residential Tenancies Act and its implications, can have a cloth influence on the availability of rental housing.

“We are pleased the off-the-plan stamp duty rebate has been extended, albeit at a reduced rate, and urge the WA government to consider making this a permanent feature of the state’s property tax system to ensure an ongoing pipeline of projects, a steady supply of diverse housing and to aid in the creation of jobs for West Australians.”

Mr Collins mentioned REIWA had been lobbying for extra important change to the state’s stamp duty regime, together with the introduction of a two-stream income assortment mannequin similar to the reform under way in New South Wales.

“Stamp duty is an important revenue earner for the WA government, but it is also an inefficient and inequitable tax that actively discourages home ownership and makes it significantly more difficult for West Aussies to move more frequently,” he mentioned.

“Reforming stamp duty by implementing a two-stream revenue collection method would remove one of the biggest financial hurdles buyers face and result in a significant productivity boost for our economy.”

UDIA’s Ms Steinbeck agreed that extra significant stamp duty reform could be a “brave step forward” for the state authorities.

“We see in the budget figures how revenue from transfer duty ebbs and flows with the market,” Ms Steinbeck mentioned. 

“A broader based tax system, like what they are implementing in NSW, would be a welcome move and remove one of the biggest barriers to people downsizing or rightsizing into more appropriate homes.”