Qld to increase stamp duty threshold for first home buyers

The Property Council has lashed the government’s budget plan to increase foreign investor land tax surcharge to offset new stamp duty concessions for first home buyers, warning it will drive up house prices.

The Property Council has lashed the government’s budget plan to increase the foreign investor land tax surcharge, slamming it as “a race to the bottom” and warning it would drive up house prices.

Premier Steven Miles announced on Sunday the stamp duty discount for first homebuyers would be boosted in a move designed to help 10,000 Queenslanders a year into the property market.

The centrepiece of Tuesday’s cash-splash, cost-of-living focused budget will be a major reset of the thresholds for stamp duty relief for first homeowners.

The threshold for the concession on transfer duty will lift from $500,000 to $700,000 making thousands of new buyers eligible for the saving. The concession will phase out up to values of $800,000.

The incentives will also apply to vacant land, with the threshold there increasing from $250,000 to $350,000. It will then phase out up to values of $500,000.

To offset the demand created by the changes, the government will increase the foreign investor land tax surcharge to three per cent – this remains lower than other states. The transfer duty surcharge for foreign buyers will lift to eight per cent – in line with NSW and Victoria.

Queensland Premier Steven Miles said the discounts would be a huge saver for young Queenslanders in particular. Picture: Richard Walker

Queensland Premier Steven Miles said the discounts would be a huge saver for young Queenslanders in particular.

But the Property Council’s Queensland division has slammed the plan.

“Today’s announcement to lift the first home buyers ceiling and funding it through increasing the foreign land tax surcharge is nothing short of a race to the bottom,” Property Council’s Queensland Executive Director Jess Caire said.

“It’s giving with one hand and taking away with the other – this will see first home buyers and renters alike facing a more competitive and more expensive market.

“What’s the point of raising the concession if there’s no one to build it?”

Ms Caire described the move as “double dealing.

“Given the Queensland Government reaped in a whopping $3.5 billion windfall in transfer duty alone in last three years, this ceiling could be raised without imposing any further taxes,’ she said.

“Queensland unlike New South Wales taxes companies that have a portion of foreign ownership – the very companies that build the new homes and apartments that the first homes owners who received this concession today will buy.

“We are well and truly losing the State of Origin.”

Ms Caire warned increasing taxes on those companies would drive up the cost of housing and squeeze more first home buyers out of the market.

“No matter how this is packaged up – it’s a tax on housing,” she said.

“This increase coupled with our already high additional foreign acquirer duty makes us completely uncompetitive to the capital we should be proactively trying to attract to Queensland.

“It’s a long bow draw to say we are now in line with New South Wales – they don’t tax companies, just individuals.

“This just sends a message that Queensland is not open for business.”

Jess Caire Queensland Executive Director Property Council of Australia. Picture David Clark

Mr Miles said the stamp duty discounts would mean eligible home buyers will save up to a maximum of $17,350 on their property purchase.

Premier Steven Miles said: “I want young Queenslanders to have more opportunity than their parents including the opportunity to own their own place. I want that for my kids too.

“This is a real cost-of-living measure that will also help deliver intergenerational prosperity.”

Treasurer Cameron Dick said the decision would “make it easier for Queenslanders” to buy their first home.

“Foreign investors have had a great run in Queensland, but they compete with Queensland families for real estate, so it’s only fair that they contribute to helping more young Queenslanders into their first home,” he said.

“Our approach to revenue ensures tax relief is always offset, so we can continue to deliver services and infrastructure, whereas the LNP will cut services because they just reduce revenue to help multinationals.”

The Property Council has consistently called for the threshold to be raised, with the median dwelling price in the city steadily climbing since the threshold was set.

Opposition Leader David Crisafulli has previously pledged to raise the stamp duty threshold, but is yet to detail what it would be raised to and the cost of lost revenue.

He is expected to use Thursday’s budget reply speech to announce detail of the increase.

The announcement on stamp duty comes after a flurry of cost-of-living announcements over the weekend, including a 20 per cent discount on car registration for 12 months and more fair play vouchers to get kids into sport.

Electricity rebates and a slash to public transport prices have also been promised.