Wagga’s real estate market could benefit from a stamp duty cut, especially if prices continue to rise in a consistent way.
The NSW government announced on Monday that it would index stamp duty brackets to inflation for the first time since 1986.
Based on the median house price of $395,000, a non-first home buyer in Wagga would be faced with tax bill on the transaction of more than $13,200.
The government has claimed that the average house sale will pay $500 less in tax from 2021, with savings to increase each year.
LJ Hooker Wagga sales consultant Jason Pearce said the tax reduction would make Wagga more appealing to outside buyers.
“It’s indexed to the Consumer Price Index, so the savings will go up, which is good in our market where prices are going up,” he said.
Wagga RE/MAX Elite director Dave Skow said reducing stamp duty would also lower the barrier for many buyers or retirees looking to ‘downsize’.
“I think stamp duty is the one real barrier to people making a move, whether that’s the older generation holding onto big old homes or whether it’s people wanting to make the upsize move.
“Stamp duty is such a big burden for them to take that plunge to the next step of their plans.
“I think that lessening that burden, there will be a lot more flow of properties between owners.”
Mr Skow said the tax had such an impact because buyers had to have the money in hand rather than borrowing it.
“When you look at deposit rates of 20 per cent, that $13,000 represents a reduction of $70-80,000 off the potential borrowings,” he said.
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