The Real Estate Institute of Western Australia (REIWA) yesterday said the removal of stamp duty will have longer-term effects than building stimulus.
REIWA President Damian Collins said while the federal HomeBuilder grant and WA's own grant will create short-term jobs, the 99% of West Australians who won't get to use the scheme are still "lumbered" with stamp duty when they buy a property.
“While the scheme will have a short-term boost to the economy, post 31 December 2020 we will be back in the same position, with stamp duty blocking upwards of a billion dollars of activity and thousands of jobs annually,” he said.
“With Victoria and New South Wales focused on getting rid of stamp duty, there has never been a better time for WA to also consider its removal to help boost jobs and the economy.”
Last week, the Australian Financial Review reported that the NSW and Victorian State Governments are considering replacing stamp duty with a land tax as an 'opt-in' system.
Currently, based on median property prices, Sydney and Melbourne residents pay around $50,000 in stamp duty.
The Australian Capital Territory has introduced a land tax, and with Canberra's median home price at about $788,000, land tax is around $8,300, split quarterly and payable alongside rates.
Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner occupiers.
Base criteria of: a $400,000 loan amount, variable, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. If products listed have an LVR <80%, they will be clearly identified in the product name along with the specific LVR. The product and rate must be clearly published on the Product Provider’s web site. Introductory rate products were not considered for selection. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term. Rates correct as at 14 July 2020. View disclaimer.
Back to the West, and the WA branch of the Property Council of Australia is supportive of the state's $20,000 grant.
"With no strict income criteria, no price caps or limitation to owner-occupiers or first home buyers, WA families have the opportunity to right-size and avoid the full hit of stamp duty," the Council's WA executive director Sandra Brewer said.
"And as people begin to act to take advantage of the incentives on offer, we expect to see the flow on benefit throughout the WA economy, a rising tide that will float all boats, including business, retail and industrial activity."
However, REIWA cites "numerous studies" that suggest the removal of stamp duty creates significant economic activity, benefiting the WA economy by as much as $1 billion per year.
The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:
- The big four banks are: ANZ, CBA, NAB and Westpac
- The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2019. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
- The larger non-bank lenders are those who (in 2019) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.
In the interests of full disclosure, Savings.com.au and loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.
*The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.
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