Two-fold cost of home stamp duty delays major life decisions

By Jack Dona · · 2 min read
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A pensive man in his kitchen holds his phone in one hand, and a few paper documents in his other hand

The cost of stamp duty for Australian capital city dwellers has doubled since the 2000s, affecting some of the major life decisions Australians make, according to economic research thinktank, e61 Institute. 

The economic research institute found it now costs the average Australian five months of take-home pay to buy a home in one of the nation’s capitals; for those in Melbourne and Sydney, it could cost six. 

The Institute attributes it to a combination of home prices outpacing income and stamp duty bracket creep. 

Stamp duty is a state government tax. The amount of stamp duty you pay depends on the price you pay for your new home – the more expensive your home, the higher the rate.

House prices in Australian capital cities rose over 450% and units rose over 300% in the last 30 years to June 2022, according to a CoreLogic report.

Stamp duty is delaying the major life decisions of Australian taxpayers 

The e61 Institute surveyed taxpayers and found the toll that stamp duty takes ‘is more than time and money’. 

According to the data, the cost of stamp duty: 

  • Delayed 25% of Australians under 40 from changing jobs 
  • Delayed over 20% of Australians between 30 to 40 from having children 
  • Deterred people of all ages from moving homes. 

So is stamp duty inevitable, or can you get around it? 

The answer, as usual, is: it depends. 

Are you a first home buyer? Then maybe. Are you buying vacant land? Perhaps. Are you a pensioner, on the National Disability Insurance Scheme (NDIS), or a farmer? You might be in luck. 

Plenty of state governments offer various stamp duty concessions for different people in different circumstances. 

First home buyer stamp duty exemptions and concessions 

If you’re looking to buy your first home, then your state government might offer to waive your stamp duty fee. However, the schemes come with strings attached. 

After a certain home value threshold is reached, you may still have to pay stamp duty, albeit at a concessional rate. That is, up until you hit the next threshold. After that, you’re up for the full amount. 

We touch on stamp duty relief and concessions for your state or territory in our First Home Owner Grant (FHOG) guides: 

Even if you’re not a first-time buyer, you may still be eligible for one of your state or territory government’s stamp duty exemptions or concessions. 

So, make sure you jump onto your government’s websites and find their home buyer scheme pages. 

These stamp duty schemes could save you thousands of dollars on the up-front cost of buying a home. 

Home loan interest rates are putting a lot of pressure on households right now, so finding a cheap home loan is a good way to ease the strain of buying a property. 

If you’re thinking about buying in the near future, make sure to compare low-rate home loans to work out where the floor currently is for interest rates. Or, take a look at some of the featured home loans below.

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Last updated 27 July 2024 Important disclosures and comparison rate warning*

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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

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