The next round of stamp duty cuts for first home buyers will come into effect on the 1st of January, 2013, when the current 20 per cent discount is increased to 30 per cent. This is pleasing news for savvy first home buyers who have been holding off purchasing a home. Now, most first home buyers whose settlement date falls beyond the 1st of January, will be eligible to receive the cut.
Good news for first home buyers
Many first home buyers may not realise that homes bought from now onwards with 60 day settlements will be eligible to benefit from the lower stamp duty because they pay stamp duty when settlement of their purchase occurs, not when they sign a contract.
Settlement occurs on the day the balance of the purchase price is paid and the property’s title document is handed over to the buyer.
This means that if you are buying your first home right now, and you meet the eligibility criteria and your settlement date is 1 January or later, you will be eligible for the 30 per cent discount on stamp duty.
This is unlike the First Home Buyer Grant, which applies from the date the contract is signed.
Other key criteria for the stamp duty cut are that the total purchase price must not be over $600,000, it is your first home and you must live in it as your primary place of residence.
If you are looking to purchase at the moment, it is sensible to establish your eligibility with the State Revenue Office before you commit to a purchase. The first step is to look at the information at the SRO website at www.sro.vic.gov.au .
Overall, the cut is good news for those buying their first home and it will be worth an additional $2,377 on a home valued at $530,000. This will bring the total stamp duty cut on the median priced home from $4,754 to $7,131.