The Launch of The Annual Land Tax Scheme for First Home Buyers

Happy New Year – I hope you had good break.

This week marks a milestone event regarding the introduction of the Annual Land Tax Scheme for First Home Buyers.

The new First Home Buyer Choice scheme allows eligible first home buyers to pay an annual land tax, instead of the standard upfront stamp duty.

Maximum purchase price is $1.5M for an established property or $800K for vacant land.

The annual fee equates to;

• $400 plus 0.3% of the land value for owner occupiers, OR

• $1,500 plus 1.1% of the land value for investors

According to the NSW Treasury modelling below, almost all first home buyers would be better off paying the ongoing land tax than upfront stamp duty.

For a $1M house – the annual property tax payments over 10 years is $19,881

Whereas, if you paid stamp duty – the bill would have been $40,090..

The First Home Buyer Choice is a game-changer, below you can see the upfront savings – it’s significant.