Getting ready for the new rush on local real estate

March 15, 2017

THE Victorian Government revealed it was slashing the much-dreaded stamp duty for first-time buyers.

ECHUCA’s housing market could be set to run hot with major changes making it more affordable to buy a home.

In separate announcements this month, the Victorian Government revealed it was slashing the much-dreaded stamp duty for first-time buyers purchasing a home worth up to $750,000, while the first home-owners grant (FHOG) in regional Victoria has doubled to $20,000.

The latter grant is available for new homes being built and cannot be used for existing homes.

Echuca real estate agents said they expected to see a jump in sales on the back of the changes.

‘‘The FHOG doubling is going to make a huge difference, especially with the number of first-home owners we’re getting through that are starting to build,’’ Century 21 sales consultant Josh Wilson said.

‘‘Because of the way prices are around here at the moment, a lot are deciding to build instead of buying established (homes).

‘‘And the stamp duty is, in some cases, a lot of money taken out of the price of buying a house, so it will probably sway a few back into buying established homes.’’

The stamp duty reduction applies to new and existing properties and is expected to save first-time buyers up to $15,000.

It will be completely abolished for purchases up to $600,000, while those valued below $750,000 will be eligible for a concession.

Charles L King director Troy O’Brien commended the government for measures which helped first-time buyers while not penalising investors.

‘‘It’s going to give young people a wonderful opportunity to get into the marketplace,’’ he said.

‘‘We think we’ll see a significant number of young people saying now is the best time ever to get into it.’’

Mr O’Brien said all first-time buyers in Echuca would benefit from the stamp duty reduction because they generally spent a maximum of $400,000 on a home.

Although the Victorian Government’s changes are aimed at making homes more affordable for new owners, there are concerns it may inadvertently lead to higher sale prices.

Mr Wilson said potential buyers could direct the money saved on stamp duty towards higher bids on a home.

‘‘When you’re calculating how much you can spend, stamp duty always was something you had to take into account,’’ he said.

‘‘Especially when you go up to $600,000 — it’s a lot of money.’’

Mr O’Brien agreed there was potential for sale prices to climb.

‘‘If it creates more competition, it might mean homes in that price range could go up,’’ he said.

The changes are due to take effect from July 1.

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