Pressure Mounts On Nsw Govt To Cut Stamp Duty
Tue March 07, 2017
March 7, 2017: The Reserve Bank has left interest rates on hold as expected, piling more pressure on the NSW Government to take a leaf out of its Victorian counterpart’s book and introduce strategic measures with the capacity to actually support first home buyers.
Laing+Simmons Managing Director Leanne Pilkington says interest rates are likely at their lowest point in the cycle - particularly from the banks' standpoint - so the time to help people get into the market is now.
And it starts with getting rid of stamp duty.
"The NSW Government has missed its chance to take a national leadership position in improving affordability for first home buyers with the Victorian Government 's unveiling of the HomesVic plan. But it's not too late," Ms Pilkington says.
"The opportunity remains to do more and the steady rate environment that is expected to prevail this year is the ideal time to act.
"Stamp duty concessions are essential at the lower end of the market to avoid the deposits of first home buyers being eaten up by such a pointless tax.
"However, reform for those looking to downsize will also be important to free up established homes and give growing families greater options to upgrade.
"The natural spike in housing turnover that stamp duty reform would generate will obviously have significant benefits from an economic perspective, but more importantly it would finally provide choice - and hope - for those younger people serious about buying a first home.
“The Government has acknowledged that new supply is a key component in improving the affordability equation. It is, but it’s important to remember that new supply means more than just new development. Freeing up established housing and making better use of available residential land is critical,” she says.
Another potential solution to support first home buyers – without adding further upward pressure to prices – is the introduction of a Government-backed savings scheme to help young people accumulate a deposit.
As for the NSW Government taking an equity position in the first homes of eligible buyers, as Victoria’s HomesVic plan allows, Ms Pilkington says it’s an idea with merit.
“The industry perspective has always been that there’s no single fix to affordability and that only through a coordinated approach will a genuine improvement be achieved,” Ms Pilkington says.
"The RBA is doing its job. The banks are fronting a parliamentary inquiry that will ideally ensure they take their obligations to their customers more seriously in the future.
"It's time for the NSW Government to play its role.”
For further information please contact:
Leanne Pilkington Stephen Naylor
Managing Director Account Director
Laing+Simmons Wise McBaron Communication
(02) 9291 7000 (02) 9279 4770