The threshold above which stamp duty is charged on new homes for first home buyers will increase from $650,000 to $800,000, and from $350,000 to $400,000 for vacant land.
However, the changes will only apply to newly-built homes and vacant land, not existing homes, and will only last for 12 months starting on 1 August 2020.
The NSW government has forecasted more than 6,000 first home buyers will benefit from the changes.
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Premier Gladys Berejiklian said the move would give much needed support to the group, as well as the construction industry.
“Thousands of people will see their bank balances benefit from this change – it will help get more keys into more front doors of more new homes,” Ms Berejiklian said.
“It will also boost housing construction across NSW and support jobs in the building industry at a time when we need them more than ever before.”
NSW Treasurer Dominic Perrottet said the changes would save first home buyers $31,335 in stamp duty on a new $800,000 home.
“The current scheme has already helped over 93,000 first home buyers since July 2017 and this will give the construction industry extra support as we face the challenges of COVID-19,” Mr Perrottet said.
“We need to ensure our building sites keep ringing with hammers and saws as that means more people working, and first home owners will save money in the process.”
First home buyers can also still access the $10,000 First Home Owner Grant, available to those buying a new home worth $600,000 or less, or buying land and building a new first home worth no more than $750,000.
David Bare, Housing Industry Australia (HIA) Executive Director NSW, said the changes to stamp duty, coupled with HomeBuilder, would give a much needed boost to first home buyers.
“Following the release of the NSW HomeBuilder details on Saturday, today’s announcement makes sense and will support many first home buyers get into the property market sooner," Mr Bare said.
“Combined with the existing $10,000 first home owners grant and the $25,000 HomeBuilder grant, first home buyers in NSW should be looking to a new home as a real option to take up home ownership."
Mr Bare added the changes would provide vital support to the construction industry which had seen many projects dry up in the wake of the pandemic.
“More importantly, this 12 month package will provide a much needed boost to an industry for which hundreds of thousands of people in NSW rely on for employment," he said.
“The home building industry will play a critical part of NSW’s economic recovery from COVID-19 related challenges and the NSW Government should be applauded for listening to our calls for greater support."
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