State's current threshold no longer reflects property prices
The Real Estate Institute of Queensland is pushing for a revision and increase in the stamp duty concession threshold rates for first home buyers, as homeownership levels continue to decline in Queensland.
Currently, first-time homebuyers in Queensland are exempt from paying stamp duty if the property is valued under $500,000.
According to REIQ CEO Antonia Mercorella, the current threshold of $500,000 for the first-home buyer's concession has not been reviewed since 2008 and no longer reflects the current property prices.
“The average cost of an entry level property has rapidly outpaced the current threshold of the first-home buyer’s concession being $500,000 and has not been reviewed since 2008,” Mercorella said. “Comparing the threshold to the annual median house price for Greater Brisbane of $760,500, and for Brisbane LGA of $1 million, it raises the question of the effectiveness of a first-home buyer stamp duty concession when the ability to utilise it is severely limited.”
Mercorella said that raising the concessional threshold for first-home buyers to at least $750,000 would be a sensible interim measure.
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“With decade-low numbers of first home buyers accessing the concession, it would be a sensible starting point for the suite of stamp duty reforms that the REIQ have been strenuously advocating for over many years,” she said.
Stamp duty's impact on housing affordability
Stamp duty is a significant factor contributing to housing affordability and accessibility challenges, REIQ said. The additional cost of stamp duty can add tens of thousands of dollars to the overall price of purchasing a new home, making it more difficult for prospective buyers to enter the market.
“It is an inherently lazy tax that rewards the state government coffers while punishing those starting their home ownership journey,” Mercorella said. “Over the past 10 years we have seen stamp duty on property transfers nearly triple – however, there has been no commensurate investment in the provision of infrastructure for new housing or social housing.”
Mercorella emphasised the need to review the decision to maintain the current stamp duty system, especially considering Queensland's low levels of home ownership compared to other states.
Potential reforms
While the Queensland government has expressed its intention to assist more Queenslanders in buying their first homes, there has been no indication of a willingness to reform stamp duty, REIQ reported.
“The Queensland government recently announced its intent to help more Queenslanders buy their first home, and one of the biggest obstacles to homeownership is stamp duty, so reforming stamp duty would be a powerful move towards that goal,” Mercorella said.
In related news, Western Australia recently announced a stamp duty concession for apartment purchasers.
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