Stamp duty, also referred to as ‘transfer duty’, is revenue levied by states on transactions relating to the transfer of land or property. It is paid upfront and needs to be budgeted for, in addition to your loan deposit.
The amount of stamp duty you are required to pay differs in each state, however there are three universal factors, along with the value of the property, that determine how much stamp duty you will pay. Contributing factors include:
- Whether or not the property is a primary residence or investment property.
- Whether or not you’re a first home buyer.
- If you are purchasing an established home, a new home or vacant land.
There are several stamp duty calculators available online that take the guesswork out of budgeting for a property. Factoring in this additional cost can’t be overlooked when you’re considering your capacity to repay a loan.
However, in a bid by state governments to stimulate home ownership and growth, there are a range of tax concessions available to reduce stamp duty.
Again, exact amounts differ across each state, but those likely to benefit the most are first home buyers and those opting to buy a new home.
