6 Oct

Warning as stamp duty escalates

first_imgStamp duty is rising three times faster than house prices says the HIA.STAMP duty is rising three times faster than house prices, and unless checked will significantly drain the pockets of future homebuyers, industry analysts have warned.The latest Housing Industry Association Stamp Duty Watch report warned that state governments were becoming increasingly reliant on housing taxes to fill coffers.“Stamp duty bills have increased almost three times faster than house prices since the 1980s and this trend will continue unless stamp duty is reformed,” said HIA senior economist Shane Garrett.Victoria’s typical stamp duty bill jumped from 1.9 per cent to 5.2 per cent of the median dwelling price between 1982 and 2017 — equivalent to a 4,000 per cent surge in the cash value of stamp duty.More from newsParks and wildlife the new lust-haves post coronavirus22 hours agoNoosa’s best beachfront penthouse is about to hit the market22 hours agoNSW homebuyers saw stamp duty rise from 1.6 per cent to 3.8 per cent during that time, while Queenslanders were somewhat less encumbered having gone from 1 per cent to 1.6 per cent. Stamp Duty as a Proportion of Median Dwelling Price, 1982 to 2017: Source: HIA“Increases in home prices cause stamp duty bills to accelerate because stamp duty rate brackets are rarely updated. This is the problem of stamp duty creep.”State government revenue from stamp duty had almost doubled in the past four year, Mr Garrett said, going from $11.7b in 2011/12 to $20.6b in 2015/16 — most of which was off residential building. “State governments are increasingly reliant on rising stamp duty revenues. This situation is not sustainable. The stamp duty burden is increasing under every metric: nominal dollars, real dollars, as a proportion of dwelling prices and as a share of total state revenue. Without reform, this trend will continue.“By draining the pockets of homebuyers to the tune of over $20 billion each year, stamp duty is a central pillar of the affordability crisis. A long plan to do away with the scourge of stamp duty would be a huge victory for housing affordability in this country.” FOLLOW SOPHIE FOSTER ON FACEBOOKlast_img

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