Is it easier to buy first home in 2023?
First Home Buyer Choice is making home ownership in NSW easier by providing first home buyers the option between paying a smaller annual property tax, instead of stamp duty.
If you’re an eligible first home buyer looking for a property up to $1.5 million, First Home Buyer Choice can lower the upfront costs of your purchase and cut up to 2 years off the time needed to save for a deposit, fast tracking your way to a new home.
Existing stamp duty exemptions and concessions for first home buyers will continue to apply for eligible purchases of up to $800,000.
The difference between stamp duty and annual property tax
Stamp duty
Stamp duty is an upfront payment, paid at the time of buying your home. It is calculated as a percentage of the property’s purchase price or current market value (whichever is higher). Stamp duty rates vary depending on the value of the property.
Annual Property Tax
Annual property tax payments are based on the land value of the purchased property. The property tax rates for 2022-2023 and 2023-2024 will be:
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- $400 plus 0.3% of land value for properties whose owners live in them.
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- $1500 plus 1.1% of land value for investment properties.
To be an eligible first home buyer in NSW:
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- you must be an individual (not a company or trust)
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- you must be over 18 years old
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- you, or at least one person you’re buying with, must be an Australian citizen or permanent resident
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- you or your spouse must not have previously owned or co-owned residential property in Australia, nor received a First Home Buyer Grant or duty concessions
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- the property you are buying must be worth less than or equal to $1.5 million
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- you must move into the property within 12 months of purchase and live in it continuously for at least 6 months
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- you must sign the contract of purchase on or after 11 November 2022.
To calculate annual property tax, please click on the link below
https://www.service.nsw.gov.au/transaction/calculate-your-property-tax
First home buyers can combine this option with other schemes available such as Home Guarantee Scheme (HGS) where eligible First home buyers can purchase home with low deposit between 2% – 5% without paying Lenders Mortgage Insurance. Other options such as discounted Lenders mortgage insurance or certain profession are eligible for No LMI products are also available.
If you are looking to purchase, upgrade or just want to understand more about those schemes please contact our broker, details below.
Anup Munankarmi
0415900264
