New 12-Month Off-The-Plan Stamp Duty Concession for Victoria

In an effort to make home ownership more accessible and stimulate the property market, the Victorian government has introduced a temporary stamp duty concession on off-the-plan (OTP) apartments, units, and townhouses. This measure, centred on the motto “More Homes Mean More Opportunity,” aims to alleviate the upfront financial burden for first-time home buyers and young investors. By slashing stamp duty costs, the government is paving the way for more young Victorians to step into the property market.

Under this initiative, the usual value cap on stamp duty concessions for OTP purchases is lifted for one year, allowing buyers of all income levels to benefit. This significant move not only supports home ownership but also promotes the development of new housing stock, offering buyers the chance to reduce their initial outlays and redirect their finances toward other aspects of purchasing a property. By focusing on lowering upfront costs, the government aims to attract both buyers and developers, accelerating the pace of construction to meet the state’s growing housing needs.

This article explores the details of this new stamp duty concession, its eligibility requirements, and the types of properties that qualify under this 12-month policy shift, which reflects a broader governmental commitment to making home ownership more attainable across Victoria.

What is the New Stamp Duty Concession for VIC Property?

On 21 October 2024, Victoria introduced a new 12-month stamp duty concession specifically for off-the-plan (OTP) purchases in a move to boost housing availability. This concession broadens existing benefits, previously limited to first home buyers and owner-occupiers, to all buyers of OTP apartments, units, or townhouses in strata subdivisions.

Key features of this new concession include:

1. Eligibility Extension: Now, anyone buying an OTP apartment, unit, or townhouse in Victoria (within a strata subdivision) can benefit from the concession, not just first home buyers or owner-occupiers.
2. Full Deduction of Construction Costs: For stamp duty calculation, 100% of the outstanding construction and refurbishment costs can be deducted, significantly lowering the taxable value of the property. 
3. Removal of Value Thresholds: The usual value thresholds of $750,000 for first home buyers and $550,000 for owner-occupiers are lifted. This change means that OTP purchases of any value now qualify for the concession, as long as they are within a strata subdivision.
4. 12-Month Availability: This concession is available for transactions within 12 months of the announcement, i.e., from 21 October 2024 to 20 October 2025.
5. Land and House Packages: House and land packages or other dwellings that are not part of a strata subdivision are not eligible for the new extended concession. However, first home buyers and owner-occupiers can still utilise the existing off-the-plan stamp duty concession for these properties. This existing concession will remain available during the 12-month period of the new measure and will continue to apply even after the temporary extension ends, ensuring that eligible buyers can still benefit from stamp duty relief.

It’s important to note that this concession applies only to properties within a strata subdivision, which typically includes shared property elements like driveways or hallways. Properties that do not meet these criteria, such as house and land packages, are not eligible. However, first home buyers and owner-occupiers can still access the standard OTP concession for these non-strata properties.

Victoria’s new 12-month off-the-plan stamp duty concession opens up significant opportunities for buyers, promoting home ownership and helping to drive the state’s housing market forward. This temporary measure makes it easier for a wider range of property buyers to reduce upfront costs and secure their place in Victoria’s evolving property landscape.

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For those navigating the complexities of property tax or seeking to maximise the benefits of this new concession, Investax Group’s Property Tax Specialists are here to help. Contact us today to learn how you can make the most of this initiative and ensure a smooth, tax-efficient path to home ownership.