New caps and rules over first home buyers schemes in New South Wales come into force on 1 July 2023.
The newly elected New South Wales government has announced extensions to the First Home Buyer Assistance (FHBA) scheme. First home buyers purchasing a new or existing property valued at less than $800,000 will pay no transfer duty. The cap increases on 1 July 2023 from $650,000. First home buyers who buy a new or existing property valued between $800,000 and $1,000,000 can apply for a concessional transfer duty rate. The qualifying range increases on 1 July 2023 from the previous band of between $650,000 and $800,000.
Purchasers who exchange on or after 1 July 2023 will receive the benefit of these higher caps.
The Minns state government has honoured its pre-election commitment to reverse the annual property tax opt-in for first home buyers. The First Home Buyer Choice scheme does not apply to contracts exchanged after 30 June 2023. Full transfer duty is payable on all contacts exchanged on or after 1 July 2023. Purchasers who exchanged between 16 January 2023 and 30 June 2023 have until settlement to make an election between an annual property tax and full transfer duty.
The residence requirement has been extended – eligible first home buyers must now occupy their home for a continuous period of 12 months instead of six months, within 12 months of settlement. The residence requirement applies to the First Home Buyers Assistance scheme, the First Home Owner grant, and the deferral of transfer duty payment for off the plan transactions.
The By Lawyers New South Wales conveyancing publications have been updated accordingly. The Purchase of Real Property (NSW) and 1001 Conveyancing Answers (NSW) guides contain detailed coverage of transfer duty concessions and government grants for the purchase of real property.