Victoria slashes stamp duty on off the plan properties: a golden opportunity for home buyers

The Victorian Government introduced a major stamp duty reduction on off-the-plan properties to boost the housing supply and make the homeownership wish of many more affordable. Effective October 21, 2024, off-the-plan apartments, units, and townhouses will be duty-free. It is such a huge step for the government to encourage with regard to alleviating the continued shortage of houses in the country and getting more Australians into entering the property market.

Within the next year, this move will reduce upfront costs involving the process of purchasing a house. This would be removing one of the critical barriers to entry in purchasing properties as far as finance is concerned. This cut in stamp duty is likely to revive construction as it will favour developers and hurry new housing projects throughout all of Victoria. The government plans to construct an extra 80,000 houses each year for the following 10 years. It has been envisioned to force developers to hasten up their activity so they can finish heaps of needed homes for homebuyers and tenants.

Under the new plan, previous stamp duty concessions—such as for first-home buyers or being limited by price range be automatically applied to all eligible off-the-plan buyers, including investors and downsizers looking to get a foot on the property ladder. Cutbacks will relieve the cost pressure for those who want to buy, at a time when rising interest rates and living costs have made it harder to get a foot on the property ladder.

But this scheme also gives an exciting opportunity to the older homeowners who are willing to downsize. With the stamp duty abolished now, it is, therefore, an attractive proposition for downsizing, which may free up larger family homes for younger buyers to come in. So, the property market will find more movement with higher availability of houses for the growth of families and new buyers.

Developers will see this as a step in the right direction towards checking the stagnation in the market. It will allow them an opportunity to raise the funding required to achieve the pre-sale quicker since the upfront costs are coming down, and this unlocks financing for the projects in question and therefore allows the building process to begin sooner. This may create increased demand for new housing projects in the near future, a factor crucial for achieving the long-term housing goals of the state.

To that end, however, the cut in stamp duty for one year, 12 months, will be quite a relief, by saving not only a huge amount of money but also making the entire process convenient. It involves purchasing off-the-plan properties within the eligibility period.

And finally, there's much to say to our real estate buyers. To homebuyers looking for a new place or an investment, this stamp duty relief is an excellent chance to save on their front pay. To boost the availability in houses, the government has actually now proposed to increase housing availability so see off-the-plan opportunities in Victoria before the end of the 12-month window.