Last week the state government announced changes to the First Home Owner Rate of Duty, which will impact buyers in the future.
Previously, stamp duty was waived for first home buyers buying a property of $500,000 or less. From $500,000 to $600,000, first home buyers were charged a reduced rate of duty.
Under the new changes, however, the duty-free threshold will be lowered to $430,000. In addition, the reduced rate will phase out between $430,000 and $530,000, after which buyers will have to pay the normal rate of duty.
Fortunately for buyers of land, the First Home Owner Rate of Duty for vacant land has been left unchanged.
When changes like this are announced, we sometimes receive phone calls asking how they affect contracts that are signed before the legislation is passed. We won’t know the answer to this question until the changes are passed through parliament, but in the past, legislation changes affecting duty only applied to contracts dated on or after the acceptance of the dutiable transaction.
However, there is a small chance that the legislation will be backdated.
What are your thoughts on the changes? Will the new Rate of Duty affect you? Leave a comment and let me know.
Image by Robert Neff via Flickr.