Victorian budget: Housing pump aims to lift market and jobs

Almost $500m will be pumped into Victoria’s housing market in a plan the government hopes will make the dream of home ownership a reality for more families.

The city of Melbourne. Picture: Tony Gough

Almost $500m will be pumped into Victoria’s housing market in a plan the government hopes will make the dream of home ownership a reality for more families.

Treasurer Tim Pallas unveiled the latest taxpayer-funded home scheme on Tuesday, predicting the plan would deliver more houses and help create new jobs.

“With a waiver on stamp duty, we’ll help more Victorians find their home and get more Victor­ians back to work,” he said.

“We will encourage Victorians back into the property market … sooner with lower deposits.”

Under the scheme, the government will waive up to half the cost of stamp duty for homes ­valued at up to $1m for contracts ­entered into from Wednesday through to June 30 next year.

That will apply only to new or off-the-plan homes, which the government says will support the construction industry. Existing homes will be eligible for a 25 per cent reduction in stamp duty.

The government said the relief was on top of existing concessions that meant a first-home buyer purchasing an existing home for $700,000 would be able to pocket tax relief of more than $18,500.

Mr Pallas said stimulating the private home sector supported the government’s massive $5bn investment in building 12,000 new homes under a public housing boost to create 10,000 jobs.

“We’re not just focusing on those who can afford to buy a home,” he said.

“In a year when home ­became increasingly central to our lives, we’re making sure more Victor­ians than ever have a roof over their heads.

“It’s a three-for-one investment: homes for our most vulnerable; jobs in construction; and economic activity. This will ­transform thousands of lives.”

The government also announc­ed a plan aimed at driving­ investment in build-to-rent properties by providing a 50 per cent discount on land tax from 2022 through to 2040, under a scheme that it forecasts will boost housing supply by 5000 homes.

Melbourne-based developers will be able to tap a $40m incentive to develop commercial and industrial properties in regional Victoria, with a 50 per cent stamp duty concession.

The Housing Industry Association backed the scheme, saying pressure would be reduced by lower deposits.

“We welcome the commitment to provide homes for many Victorians in need and an injection into the economy, particularly as the work is set to commence immediately,” said HIA Victoria executive director Fiona Nield.