GOVERNMENT INCENTIVES FOR PURCHASING OFF-THE-PLAN

October 6, 2022

The government has implemented many benefits for anyone looking to purchase off-the-plan, making it an attractive option for all kinds of buyers who qualify for them.

In terms of off-the-plan, these incentives include different types of concessions available. Most of these concessions will benefit first-time home buyers and purchasers who plan to live in the homes they purchase.

What Is An Off-The-Plan Transaction?

The term “off-the-plan” refers to purchasing a property before or during the construction of the property.

Off-the-plan refers to a transaction that involves land that has not yet been subdivided, an apartment, townhouse or another type of dwelling.

Off-The-Plan Stamp Duty Concessions

One of the incentives of purchasing off-the-plan is that home buyers can take full advantage of the benefits available, especially those that reduce upfront fees required to secure a home.

What Is Stamp Duty?

When transferring the ownership of a property, the Government will impose a duty on it. This is referred to as transfer duty or stamp duty and will be calculated on the purchase price of the property or the value of the property.

What Off-The-Plan Concession Is Available For Stamp Duty?

The availability and eligibility of stamp duty concessions vary between states.

In NSW, the stamp duty concession works by pushing the due date 12 months into the future, which is ahead of the standard 3-month timeframe, or until the property has been officially handed over.

In the ACT, if your contract was exchanged between 1 July 2021 and 31 March 2022, no stamp duty applies to off-the-plan unit owner-occupier purchases up to $500,000. However, as of April 2022 it has increased to purchases up to $600,000.

There are also a number of other first home owner concession opportunities, which include the First Home Buyer Assistance Scheme in NSW, which can be applicable to the dutiable value of off-the-plan properties.

Who Is Eligible For Off-The-Plan Concessions?

To be eligible for a stamp duty concession in NSW, the off-the-plan property you propose to acquire must be a residential property. Additionally, at least one purchaser must live in the property as a principal place of residence for 6 months continuously within 12 months of purchasing the home.

Purchasers may be required to pay a penalty tax if specific residence requirements are not met.

How to Apply for Off-The-Plan Stamp Duty Concession

Currently, the State Revenue Office manages concession applications relating to first home buyer off-the-plan purchases in New South Wales.

Here’s a quick guide to applying:

After you’ve exchanged contracts with the previous owner, you can apply for either of the following by downloading and completing the forms:

  1. First Home Buyers Assistance scheme application form
  2. Purchaser/Transferee Declaration form (individual)

You then need to lodge your application forms and supporting documents with your solicitor or conveyancer.

You can find further information and access the application form here.

What other incentives are available for off-the-plan purchases?

There are other incentives available for those who wish to purchase off-the-plan however the following incentives are only available to first home buyers.

First home owner grant

The first home buyer grant gives you $10,000 towards the purchase of your first home.

For more infomation, click here.

First home super saver scheme

The First Home Super Saver Scheme allows first home buyers to use their super as a deposit toward their first home.

For more information, click here.

First Home Guarantee

The First Home Guarantee formerly known as ‘The First Home Loan Deposit Scheme’, allows first home buyers to purchase property with deposits as little as 5% – without paying Lender’s Mortgage Insurance fees.

For more information, click here.

First home buyers assistance scheme

In NSW, the First Home Buyers Assistance Scheme can save you anywhere up to $22,000 in upfront stamp duty costs when buying your first home.

For more information, click here.

Final Words

Want to purchase off-the-plan property and take advantage of the government incentives?

Contact us below to speak to a St Trinity property consultants who will help answer any of your questions or to talk about our latest off-the-plan properties available for purchase.

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