On 1 June 2017, The NSW State Government announced new changes to its stamp duty regime in an attempt to make housing more affordable for first home owners.
Increase to the foreign person surcharge
The NSW Government has announced that it intends to increase its 2016 foreign person stamp duty surcharge from 4 per cent to 8 per cent. The Government also intends to increase its foreign person land tax surcharge from 0.75 per cent to 2 per cent. The increase is expected to take effect from 1 July 2017.
Relief for foreign developers
It is expected that foreign developers will be exempt from the foreign person stamp duty surcharge and land tax surcharge from 1 July 2017. This change brings NSW into line with Queensland and Victoria who already have exemptions in place for foreign developers.
New first home owner grants and exemptions
From 1 July 2017, first home buyers will:
be exempt from stamp duty for all properties (new and old) worth up to $650,000; and
receive a stamp duty discount for all properties (new and old) worth up to $800,000;
be subject to a stricter Frist Home Owner Grant regime.
Abolishment of the 9 per cent stamp duty on lenders mortgage insurance
The 9 per cent insurance duty on lenders mortgage insurance will be abolished from 1 July 2017.
Investors will no longer be able to defer stamp duty for 12 months on “off-the-plan” purchases. However, the deferral regime will still apply to owner occupiers.
Funding available to councils to update their Local Environmental Plans
The Local Environment Plans (LEP) of 10 priority councils in Greater Sydney will be updated to reflect the final District Plans within two years of the Greater Sydney Commission finalising the District Plans.
Up to $2.5 million will be available to each priority council to assist them to update their LEP, with payments also available to up to five other councils that volunteer to accelerate updating their LEPs.