has anyone read this, zero stamp duty for seniors 65+ looking at buying new property up to $600,000. saving up to $22k and costing the government $10m over the next 2 years
http://www.smh.com.au/nsw/zero-stamp-duty-lure-for-older-homeowners-to-downsize-20100608-xs40.html?autostart=1i actually think for once they are onto something, will create more construction, but the question is how do seniors 65+ get a loan, do they pay out right?
Seniors can still get loans if they are working – mostly self employed i guess.
Maybe we could all use our parents/grandparents to buy our properties and then set up testamentary trusts.
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It is intended for downsizers, to get them out of 4 bedroom houses, into units. They should end up with a significantly cheaper house than before.
Does anyone who is currently investing in property fall in this age bracket? Imagine being able to do renos without stamp duty, would be fantastic!!
shahabr wrote:…and costing the government $10m over the next 2 yearsAnd guess who's going to bear the brunt of the $10 million cost. That's right. You and me.
What the gov't giveth to someone, they also taketh from somebody else.
Can anyone advise the details of the new budget as at 1st July around no stamp duty on properties bought off the plan? Is that correct?
Being in Vicoria we have had stamp duty concessions for property sold off the plan, (it was based on the land value) however the no stano duty in NSW is interesting, I understand it is for property under $600K.. Should see a big jump in ne developements , first home buyers and a trickle effect.
Intresting from a seniors perspective where I think the idea is to assist with their down sizing. They would get morre bang for their buck for the purchase of a smaller property. I guess the strategy would be to sell up, buy a less expensive property easier to maintain place and have a cash lump sum availalble. In theory not a bad idea. This is assuming the seniors would be cash buyers when down sizing.
Just to add by 2 cents regarding finance options– let me know if i am mistaken- seniors can still qualify for finance if they meet lending criteria–an issue may be in obtaining a 30 year loan if they are of advanced years i.e 70-80. I bring this up as a topic of discussion as you cannot discriminate against age when lending, however you need to show the capacity to be able to service the loan over the term.
Just thought i would throgh my rant,
thanks
Rick
So Rick the zero stamp duty on off the plan purchases up to $600k is only in NSW? What’s everyones opinions on off the plan? I have heard it’s quite risky however I would still do my usual due diligence around independant valuer, independant real estate agent for rental appraisal etc. Is VIC 50% off stamp duty on new homes?
VIC offers additional FHOGs for new home owners. You only pay stamp duty on the land for new homes.
Rick,
I have just refinanced a client with a lender and they certainly discriminated on age (think little green dragon) as the clients easily serviced, no debt, one 55 and other 65, LVR was only going to be <50%. After many hoops (most simply ludicrous) they said they would not lend 1 cent. After threats of going to the discrimination commissioner, we negotiated for a facility of $120k, far less than they originally requested but sufficient. In retrospect the 55 could have borrowed in her own name for more than they finally agreed to. Just stupid.Be careful as some lenders have unwritten policies. I had run the scenario with their BDM who said they could do it and he was surprised at the rejection.
Most seniors over 65 can obtain a reverse mortgage if they need further funds and they own their PPOR. Whether it is worth doing depends on how much $'s they want. The NSW gov't concession on stamp duty will help people make the economic decision to downsize without the costs that existed previously. As mattnz said, it is intended for seniors downsizing and freeing up equity. If you think about it, it may push some from full pension into part pension as they then may have an issue with the assets test.
WRT off-the-plan, there is a section of investors that it can work for. In Victoria the benefits are significantly lower stamp duty, higher depreciation and potentially lower maintenance costs. In a rising market where the COS has been signed > 12 months previously, some lenders will allow the higher of valuation or COS price. This meant for one of my clients, he only put in $16k all up and ended up with a property valued at $410k at an 80% lend. The risk is the market moves the opposite way or you simply got conned by a sales marketing company and paid too high a price and valuation time, it doesn't stack up. Think Docklands.
The investor it suits is high income low deposit.
Greg
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