Stamp duty concession puts pressure on prices
The NSW government's decision to remove stamp duty for off-the-plan property under $600,000 could push up prices. To obtain the full $22,490 saving offered in the budget, buyers must sign up before building commences. If construction has already begun, they are eligible for a $5623 discount. And to be eligible, the building must be completed within two years of a buyer exchanging on the deal.
The chief economist with St George Bank, Justin Smirk, said ”it's certainly going to create more demand” he said. ”But the problem is it takes a long time for the credit approvals to get through the [banking] system”.
David Milton, the managing director of agents CB Richard Ellis said the plan was ill-conceived because most large developments would not comply and the two-year time frame would be too tight. ”A lot of our projects have 20-month to two-year building periods,” Mr Milton said. ”And if there are wet-weather delays or if there are issues with your builder, it's not going to work out”.
Source: Sydney Morning Herald