Stamp duty changes in Victoria and why politicians should butt out.

It was announced recently that first home buyers would now be exempt on all properties up to $600,000. This was widely reported. What was not widely reported is that stamp duty savings on off the plan properties would now be removed. This means that if you are buying an off the plan apartment, full stamp duty will now apply on the contract price and not just on the land component. This will clearly further damage the apartment markets in Victoria.

So, what will investors do? Well if you buy a house and land package you settle the land and then enter a building contract. So, the stamp duty is on the land only. This will mean that investors will buy house and land packages. The stamp duty savings and the lack of available land will force prices up. The effect will make it harder for first home buyers. Another dumb political decision that will not work. The politicians do not know what they are talking about. But what is new in that.