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Also known as “transfer duty”, stamp duty is one of many expenses that come with buying a property in Australia. The rates of stamp duty vary between state and property type - and are affected by a number of other factors. When you’re budgeting to buy a property, it pays to be prepared for how much stamp duty you may have to pay. That way, there are less likely to be any nasty surprises along the way that could put a big hole in your budget.
Since the rules vary between states, we’re going to focus on transfer duties in NSW. Keep reading to ensure you’re in-the-know.
There are a number of circumstances in NSW that require a stamp duty payment1. When you buy any of the following, this will incur a transfer duty cost:
If you happen to acquire land or an interest in land, without buying it, you may also need to pay transfer duty. Examples can include:
In NSW, stamp duty is calculated depending on the value of the property. Below is the list of standard NSW stamp duty rates (as updated in July 2019)1. Remember that these standard rates don’t apply to all property purchases and can vary depending on some other circumstances, such as first home and foreign buyers.
For a stamp duty estimation based on a predicted purchase price, you can use our Stamp Duty Calculator.
It’s important to keep in mind that:
The NSW government has made some changes to transfer duty rules, as a way to encourage new homeowners and help them get onto the property ladder. As a first home buyer in the state, you could be eligible for full or partial exclusion from transfer duty payment, as long as you meet the qualification criteria which includes but is not limited to2:
This exemption applies to more buyers than the NSW First Home Owner Grant (FHOG), which offers a grant to first time buyers if they are purchasing a newly constructed property or a property bought off the plan3.
While first home buyers are often exempt from paying stamp duty or receiving stamp duty concessions, this is not the case for foreign buyers. If you want to buy a home in NSW but are not an Australian resident or citizen, you’ll be obliged to pay an additional stamp duty surcharge4.
At July 2019, this surcharge is 8% of the value of the property you buy and is charged in addition to any applicable transfer duty.
Whatever stage you’re at, buying a property is a huge financial commitment, so it helps to have support behind you.