Housing initiatives announced by the Victorian Government
This article covers the recent housing industry stamp duty and tax changes that are to be introduced in 2017, which include:
- Increases to the First Home Owner's Grant for Regional Victoria
- Stamp Duty to be abolished for many First Home Buyers
- Stamp Duty concessions to be removed for Investors buying Off The Plan
- Vacant residential properties in Melbourne to be hit with a new tax
Full details of the above proposed changes are yet to be released by the Victorian Government
First Home Buyers Grant:
The First Home Owner's Grant is proposed to be increased from $10,000 to $20,000 for eligible First Home Buyers that are purchasing new homes being constructed in the regional areas of Victoria that are valued at less than $750,000. This change is proposed to take effect on contracts signed from the 1st of July 2017.
Stamp Duty for First Home Buyers:
For new or established properties valued below $600,000 the Victorian Government proposes to totally abolish stamp duty for First Home Buyers that qualify. For First Home Buyers of properties valued between $600,000 and $750,000 there will be a sliding scale of stamp duty concessions. The stamp duty concessions and exemptions are proposed to take effect on contracts signed on or after the 1st of July 2017.
Off The Plan Stamp Duty Changes:
The Victorian Government intends to remove the current stamp duty concessions for Off The Plan property purchases by investors. This proposed change is due to take effect for contracts signed on or after the 1st of July 2017.
Melbourne Vacant Properties Tax:
The Victorian government intends to introduce a vacant property tax on residential properties that remain vacant for more than six months a year. This will be based on the total time vacant during each calendar year and the onus will be on owners of vacant residential properties to notify the State Revenue Office. The vacant property tax will charged on an annual basis and will be taxed at 1 per cent of the capital improved value of the property. The tax is to apply to properties in the inner and middle suburbs of Melbourne.
Exemptions of the Vacant Properties Tax:
- Dwellings in the city that are used for work purposes
- Properties owned by deceased estates
- Properties that are subject to legitimate temporary absences, such as overseas appointments or medical care
- It is proposed that this tax will apply from the 1st of January 2018
The Victorian Government and the SRO (State Revenue Office) will release detailed information on each of the above mentioned proposed changes over the next few months.
A Note To Investors:
If you have been considering purchasing an investment property, then now is the time to take action, before these changes in stamp duty take place and before the impending stampede of First Home Buyers.
Call or email our office today and take advantage of the best market conditions you are likely to see for many years.
Free Download: The Pros and Cons of Buying Off The Plan