States in stoush over homebuyers

A cross-border tremor has occurred on the home buyer front.

A cross-border tremor has occurred on the first-home buyer front. Picture: Jason Edwards

A minor cross-border tremor has occurred on the first-home buyer front.

The Queensland Government has announced the abolition of stamp duty on new homes for first-home buyers buying up to $800,000, as it seeks to deliver improved housing affordability for its residents.

The decision aims to boost housing supply across Queensland with forecasts that about 3000 first-home buyers will benefit each year. Albeit amid an acknowledged void in data on first-home buyers purchasing trends in new properties or vacant land among those 20,000 buyers each year.

The reforms will see first-home buyers saving up to $29,500, depending on location after its implementation in May, coming at a time when Queensland completion rates of new homes, and the rates of building approvals, are below the historical average.

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First home buyers have been warned that the good news on interest rates could turn out to be a double-edged sword when it comes to house prices.

Queensland Treasury emphasised that the relief is limited to “a narrow segment of the housing market”.

But the worry for NSW is that it could prompt an escalation in the migration of young workers to north of the border.

Queensland already does well with its net interstate migration up 29,910 in the year to last June, the highest population boost among any of the states.

NSW’s population fell 30,865 in its net interstate migration.

The new measure comes against the backdrop of Queensland having the lowest rate of home ownership of all states, sitting at 63.5 per cent, slightly lower than the 64 per cent in NSW.

In 1971 the Sunshine State had the second highest rate with its largest decline in the 25- to 34-year-old bracket.

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Could more young NSW workers move to Qld instead? Picture: Sam Ruttyn

The Brisbane local government area now has the second highest median capital city house price in Australia, at $979,000, following its continued post-pandemic price boom. Its apartment median sits at $675,000.

PropTrack puts Sydney at a considerably pricier $1,437,000 and $815,000 respectively.

Of course NSW does offer exemption from stamp duty when buying a new or existing home valued up to $800,000, while homes valued up to $1m qualify for a concessional rate.

The Queensland move comes alongside changing the rules to allow first-home buyers to sublet rooms in any new home, as long as the purchaser also occupies the property.

In what was a silly anachronism, previously first-home buyers were barred from renting out part of the property for a year from taking occupancy in the state where the rental vacancy rate has continued at 1 per cent since December 2023 (against a healthy vacancy rate of between 2.6 to 3.5 per cent, according to the REIQ submission).

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Qld first home buyers can now rent out their spare room. Picture: Sam Ruttyn

Queensland is ranked No.1 in the Housing Industry Association’s Policy Scoreboard Rating that ranks the housing policies of each state and territory governments against 10 key metrics it believes are crucial to hit the federal government’s target of 1.2 million new homes.

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Originally published as States in stoush over homebuyers