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House of Assembly - Fifty-Fifth Parliament, First Session (55-1)
2023-08-30 Daily Xml
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Stamp Duty Abolition

In reply to Mr COWDREY (Colton) (29 June 2023). (Estimates Committee B)

The Hon. S.C. MULLIGHAN (Lee—Treasurer): I have been advised the following:

1. Given the intentional similarities in eligibility criteria between the First Home Owner Grant and stamp duty relief for first-home buyers, First Home Owner Grant data informed the DTF modelling of demand for the stamp duty relief measure. While the level varies between years, First Home Owner Grant data indicates that approximately 80 per cent of grant payments have been for vacant land build contracts in recent years, with the remaining 20 per cent for newly built homes. Consistent with this experience, estimates in the 2023-24 budget assume that, of the 3,800 first home transactions forecast to qualify for stamp duty relief, around 3,000 transactions will be vacant land build contracts with the remaining 800 expected to be newly built homes.

2. The number of First Home Owner Grants paid each year, on average, over the past five years (2017-18 to 2021-22) was around 3,500, with the applicable property value cap being $575,000. The property value cap for the First Home Owner Grant is based on the market value of the home, which includes the combined value of land, the home and other relevant improvements. These transactions were subject to stamp duty on their dutiable value (generally site value for vacant land build contracts and capital value for newly built homes).

Stamp duty relief is available for eligible first-home owners on the purchase of new homes valued less than $700,000 and vacant land valued less than $450,000. These value thresholds are expected to result in a higher number of first-home buyers becoming eligible for stamp duty relief compared to the number of First Home Owner Grant recipients under the previous $575,000 property value cap. This takes into account expected property value growth and the composition of first-home buyers.

3. It is estimated that around 3,800 first-home buyers per annum will benefit from the stamp duty relief introduced in the 2023-24 budget.

The total cost of the stamp duty relief is estimated at $33 million in a full year (2023-24 financial year). The total cost of the relief has regard to the expected number of vacant land transactions relative to newly built properties.

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