Key Changes to NSW Property Laws

Surcharge Purchaser Duty Increase for Foreign Buyers

Effective 1 January 2025

• The surcharge purchaser duty for foreign buyers has increased from 8% to 9%.

• This applies to all residential property purchases in NSW by foreign buyers.

Off-the-Plan Contract Law Review

Expected Changes in 2025

• The NSW Government is reviewing off-the-plan contracts to introduce financial penalties for developers who fail to deliver properties as promised.

• Buyers may soon gain greater protection and compensation rights if developers do not meet their obligations.

Foreign Resident Capital Gains Withholding (FRCGW)

Effective 1 January 2025

• Threshold Removed – All property sales, regardless of value, are now subject to withholding.

• Withholding Rate Increase – The tax rate has risen from 12.5% to 15%.

• Impact on Sellers – To avoid the 15% withholding, sellers must obtain an ATO clearance certificate before settlement. Processing can take up to 28 days, so applying early is essential.

Strata Law Reforms

Effective 3 February 2025

• New regulations aim to enhance transparency and accountability in strata property management.

• Buyers of strata properties should be aware of enhanced disclosure requirements and changes in management practices.