ByLawyers News and Updates

First home owner – SA

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Property value caps have been removed for both the First Home Owner Grant and the stamp duty relief available to first home owners.

These provisions were announced in the 2024-25 State budget, and apply to contracts entered into on or after 6 June 2024.

Additional measures to tighten the previous home ownership criteria will apply to contracts entered into on or after the Statutes Amendment (Budget Measures) Bill 2024 passes and the Act receives assent.

Stamp duty amendments

The property value caps for stamp duty relief have been removed. For contracts entered into on or after 6 June 2024, full stamp duty relief applies on the purchase of all eligible new homes and vacant land used to build a new home, regardless of price.

The additional amendments to apply from assent of the amending Act will:

  • tighten the previous home ownership criteria so that a first home buyer and their spouse or domestic partner who have previously owned a residential property in Australia will not be eligible for stamp duty relief, including where that property was not occupied, or was occupied for less than 6 months; and
  • remove relief for first home buyers from the foreign ownership surcharge.

 First Home Owner Grant amendments

The property value caps have been removed for contracts entered into on or after 6 June 2024 for first home owners buying or building a new home, regardless of price.

The additional amendments to apply from assent of the amending Act will:

tightens the previous home ownership criteria so that a first home buyer and their spouse or domestic partner who have previously owned a residential property in Australia will not be eligible for a First Home Owner Grant, including where that property was not occupied, or was occupied for less than 6 months.

Publication updates

The by Lawyers  Conveyancing (SA) publication has been updated regarding the removal of the property value caps, including the commentary and the Retainer Instructions – Purchase of Real Property in the Purchase guide. The updates relating to the tightening of the previous home ownership criteria and the removal of relief for first home buyers from the foreign ownership surcharge will be made in due course.

Stamp duty – SA

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Amendments to stamp duty and land tax concessions were introduced in the most recent state budget and apply in the current financial year.

Summary of changes

  • Introduction of stamp duty relief for eligible first home buyers who enter into a contract to purchase a new home or vacant land to build a new home on or after 15 June 2023.
  • Increase in the property value cap for the first home owner grant in relation to eligible transactions entered into on or after 15 June 2023 from $575,000 to $650,000.
  • Introduction of a land tax reduction for eligible build-to-rent projects where construction commences on or after 1 July 2023.

Stamp duty relief for first home buyers

Stamp duty relief is now available to eligible first home buyers who entered into a contract to purchase a new home or vacant land to build a new home on or after 15 June 2023.

This relief is not available on the purchase of an established home, including a planned knock-down and rebuild.

New home

Full stamp duty relief applies on the purchase of an eligible new home valued up to $650,000, with reduced relief for properties valued up to $700,000.

Vacant land on which a new home will be built

For the purchase of vacant land on which a new home will be built, full stamp duty relief applies for land valued at up to $400,000, with reduced relief for land valued up to $450,000.

Eligibility requirements

The eligibility criteria are based the first home owner grant. This is set out in detail in the commentary in the By Lawyers Purchase of Real Property guide.

First Home Owner Grant threshold increase

The property value cap was increased for the first home owner grant in relation to eligible transactions entered into on or after 15 June 2023 from $575,000 to $650,000.

Land tax reduction for build-to-rent projects

To promote new housing opportunities, a land tax reduction is available for eligible build-to-rent projects when construction commences on or after 1 July 2023. This is applied as a 50% reduction in the land value of relevant parcels of land being used for an eligible build-to-rent project.

The land tax reduction is available from the 2023-24 financial year up to, and including, the 2039-40 financial year.

By Lawyers publication updates

The By Lawyers Conveyancing (SA) publication, which includes the Sale of Real Property guide and the Purchase of Real Property guide, has been updated to reflect these changes, including the commentaries, to-do lists, retainer instructions, and initial letters.

NSW – OSR changes

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First Home owner

  • First Home New Home scheme ended 30 June 2017 and was replaced by First Home Buyers Assistance scheme. From 1 July 2017 first home buyers of new OR existing homes to the value of $650,000 will pay no duty. Concessions are available between $650,000 and $800,000. There is no change to the caps for vacant land which are exemption to $350,000 and concession from $350,000 – $450,000.
  • First Home Owner Grant (New Homes) scheme property caps are amended from 1 July 2017. The cap for purchasing a new home is $600,000, or $750,000 for the house and land when building a new home under a home building contract or by an owner builder.

Shared Equity Scheme.

A person may purchase a property with an approved equity partner. Subject to eligibility the home buyer may apply for first home buyers assistance and grants. Subsequent transfers from the equity partner to the home buyer are exempt from duty. Principal place of residence land tax exemption is applicable from 2018 tax year.

New Home Grant scheme.

The $5,000 grant for any purchaser of a new home ends 30 June 2017.

Payment of duty in off the plan purchases.

From 1 July 2017 the 12 month duty liability deferral is only available to purchasers who declare their intention to occupy the property as their principal place of residence. If the property is not occupied for 6 months commencing within 12 months of completion interest and penalty tax apply from the lability date.

Foreign Purchaser Surcharge Duty.

Foreign Purchaser Surcharge Duty has increased from 4% to 8% .

Commercial residential property is exempt – retrospective to 21 June 2016.

Permanent residents, including NZ citizens holding a special category visa, are exempt from the surcharge on their principal place of residence if they occupy the home for a continuous period of 200 days within 12 months of purchase.

Australian-based developers will pay surcharge purchaser duty when purchasing the land however may be entitled to a refund on the sale of a new home built by them, if they are an Australian corporation.

Foreign Person Land Tax Surcharge.

From the 2018 tax year the surcharge land tax rate will increase from 0.75% to 2% and commercial residential property will be exempt. Permanent residents, including NZ citizens holding a special category visa, are exempt from the surcharge on their principal place of residence if they occupy the home for a continuous period of 200 days within the land tax year.

Australian-based developers will pay surcharge land tax, however may be entitled to a refund on the sale of a new home built by them if they are an Australian corporation.

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