Commenting on the latest CoreLogic Property Pulse, head of research Tim Lawless highlighted that based on the median dwelling value across each capital city, stamp duty estimates can range from $32,680 in Melbourne to $9,000 in Brisbane.
Mr Lawless noted that the system can be quite confusing due to “significant differences” regionally, as well as the complexity of rules, concessions and limits that are applied to the calculation of stamp duty, particularly in the country’s two largest cities.
“Because stamp duty costs are percentage based, as dwelling values move higher, stamp duty costs can rise disproportionately faster due to bracket creep,” he said.
“Over the past five years dwelling values in these two cities have increased by 62 per cent and 38 per cent respectively which implies at least a commensurate rise in stamp duty costs in these cities. The high transactional costs associated with housing are likely to be one factor that is contributing to a slowdown in the number of sales across the country.”
Mr Lawless explained that stamp duty costs in addition to the fact that most lenders seek a 20 per cent deposit present “substantial” barriers to entry for home buyers.
He added that if transaction numbers across the housing market continue to trend lower, it is likely that state governments will encounter a “budget hole” as stamp duty revenue falls.
“For this and associated reasons, we may find state governments become more serious about considering a broader based land tax that is applicable to all property owners rather than a stamp duty that is payable only across the small percentage of properties that transact each year,” Mr Lawless concluded.
[Related: Stamp duty debate ongoing]