As reported in the SMH, just 249 retirees have taken up the stamp duty-saving initiative of the former state government aimed at encouraging seniors to downsize into new homes. The empty nesters’ zero stamp duty scheme was unveiled in the last state budget to boost NSW home construction.
Treasury forecast between 1000 and 2000 seniors would take up the offer annually after it started on July 1. The scheme was billed as an Australian first by the then premier, Kristina Keneally and the government budgeted $20 million for the two-year scheme, but just $3.2 million has been allocated in the first eight months.The average stamp duty exemption for the 249 participants to date has been $13,200.
North coast seniors have had the highest take-up with 28 buying new houses and 22 buying new units. In Sydney, just 39 seniors have secured the stamp duty bonus, averaging $16,000. In the Hunter Valley, 32 seniors have secured the savings. Stamp duty savings of up to a maximum $22,490 for a $600,000 purchase are available.
Last month the Premier, Barry O’Farrell, released the new state government’s 100-day action plan, which confirmed the Coalition’s pre-election promises to extend the transfer duty concession to people older than 55 during its final year of operation. The government proposes that this exemption will be available to people over 55 for sales between July 1, 2011 and June 30, 2012, after which it will be reviewed.
You have to wonder: why is this scheme so under-utilised? Are seniors simply choosing not to sell in a flat property market? Or are they unaware they can claim the exemption?
What are your thoughts?
Anecdotally, at Seniors First we are seeing seniors increasingly turn to equity release and reverse mortgage products to tide them over until the house prices improve. Is this a state/country wide trend? It is difficult to confirm right now : industry figures published by SEQUAL for the most recent 12 months are not yet available.
Comments welcome….
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Is the stamp duty saving only available to people over 55 buying brand new homes when downsizing? If the proposed new home/.villa/ unit is a few years old are we unable to get the stamp duty benefit?