REINSW president John Cunningham has said that a decision by the Victorian government to abolish stamp duty for first home buyers for purchases below $600,000 should propel the NSW government to meaningfully tackle housing affordability.
“Affordability affects everyone, and it affects the young in a more tangible way... we've got people being educated, entering the workforce, and not being able to live where they need to live to work, so they start looking elsewhere,” he told Mortgage Business.
Victorian Premier Daniel Andrews announced over the weekend that purchasers of properties between $600,000 and $750,000 will also receive a stamp duty concession applied on a sliding scale.
“Victoria has acted,” Mr Cunningham said. “It is time for NSW to step up and take a stand. Whatever they do, they need to do something, because FHBs have been left in the dark for too long.”
“NSW is now living in the shadow of our southern counterparts. We will lose our best and brightest if we do not match or better what Victoria has pledged to introduce.”
Mr Cunningham said that Victoria’s new measure is “a really important move” for the state and NSW should look at implementing a similar concept to provide for its first home buyers.
“The Victorian scheme is being addressed for Victoria's needs... we can't introduce the Victorian scheme here at that level, it wouldn't have the same effect.
“The median house price in Sydney is close to $1.1 million so anything that we introduce here has to be considerate of that position, to ensure that we actually do cover the majority of FHBs who are probably sitting around that median unit price level.”
Mr Cunningham added that while stamp duty is a key aspect of the housing affordability issue, the state’s supply also requires urgent attention from the NSW government.
“One of the biggest solutions here is to bring back dual or multiple occupancy options on suburban land, so that when you have a certain land size you can subdivide that,” he suggested.
“It allows FHBs to achieve their housing option, albeit on a smaller block of land... we need to get stock into the marketplace quickly, and one of the best ways we can do that is through a medium density housing policy that enables subdivision particularly in the middle ring suburbs of Sydney, on smaller plots of land.”
He elaborated that NSW Premier Gladys Berejiklian should “put meaning behind” her assertion that housing affordability is the number one priority for her government. “The clock is ticking and the government must act now before it is too late,” he said.
FHB package a ‘major step’ forward for Victoria
As part of the package for first home buyers, the Victorian government will establish HomesVic, a $50 million program to co-purchase 400 homes taking an equity share of up to 25 per cent. Eligible applicants will include couples earning up to $95,000 and singles earning $75,000.
Regional Victoria also announced a doubling of the first home owners grant for regional Victoria. First home buyers building new homes in regional Victoria will be entitled to $20,000 as of 1 July this year, up from $10,000 for new homes valued up to $750,000.
The move has also been welcomed by the Housing Industry Association, which said that the package shows the Victorian government continues to recognise housing affordability as a key policy issue.
HIA Victoria’s acting executive director Keith Banks said: “The announcement that stamp duty will be abolished for most first home buyers in Victoria is great news for housing affordability… this policy will provide thousands of Victorians with the ability to enter the market faster than previously possible and will provide a boost to Victoria’s residential housing industry.”