Tax burden puts Melbourne homes ‘out of reach’
The triple burden of federal, state and local taxes is pushing new homes in Melbourne out of the reach of the average homebuyer, the Housing Industry Association says in a new report. More than 20 kinds of taxes apply to new houses and add around $88,000 to the price of a typical home. Many of the taxes are applied several times on the one property, with homebuyers unaware of them.
The average price of a new Melbourne house and land package is now $338,000, with taxes driving up the cost by almost 25 per cent. The taxes have increased by 20 per cent a year over the past 10 years, far outstripping inflation at 2.6 per cent per year.
The HIA wants the Council of Australian Governments to start an enquiry into housing affordability, believing that the central issue is funding for urban infrastructure. The Prime Minister, however, criticised the states for failing to reduce stamp duty. He stated that local taxes and charges, in particular stamp duty, are the real culprits in adding to the cost of new houses.