After a year of ups and downs, the race is on to the finishing line to buy properties before Christmas.
Taylors Strategic Partner, Amanda Gould - Director and Principal Buyer's Agent of HighSpec Properties - leads us into summer with her advice for property buyers and insight into the NSW proposed changes from stamp duty to property tax.
Why Now Is A Good Time To Buy
As we enter into the last month before our industry closes down for its well-earned break, we are still racing to the finishing line to buy our clients properties before Christmas. If you are wondering if this is a good time to buy, you are not alone. We are asked this most days. The good thing about buying now is, the closer we get to Christmas the less time there is for a traditional marketing campaign so we usually see a spike in off-market sales.
Stamp Duty vs Annual Property Tax: Proposed NSW Reforms
Everyone is all a-buzz with the major reform that has recently been announced regarding the antiquated stamp duty we pay in NSW. The proposed change would see stamp duty replaced by annual property tax. Replacing the large upfront cost of stamp duty with an annual fee should make homeownership more achievable for many buyers, particularly as the average cost of stamp duty in NSW is currently around $34,000. This avoids setting aside a large chunk of money to pay our most hated tax, also it will be great for property flippers like myself, as you can get in and out of the market quickly without hitting the bottom line.
How would the new property tax work, I hear you ask? The new property tax would comprise of a fixed amount plus the percentage of the unimproved land value of the property, this will be paid annually. home buyers will have the option of paying a large upfront sum similar to the stamp duty we pay now or paying the annual property tax. Once the property is subject to the property tax, subsequent owners would not be able to opt for the lump option, existing homeowners who already pay stamp duty will not be subject to the annual property tax on their own property.
Owner-occupier homes will attract lower property tax than investment properties, rules will be putting to place to avoid unfair rental increase raises due to the new tax. First-time buyers currently eligible for stamp duty concessions will receive a $25,000 grant. This will definitely stimulate buyers in the market.
Consumer Confidence Is High
Consumer confidence has hit a seven-year high in November, reaching an index of 107.7. This means the majority of Australians are optimistic about the state of our economy – and so they should be. Reduced loan deferrals, another interest rate cut and extended budget stimulus is giving Australians the security they need to start spending again as we emerge from the recession.
Mortgage Deferrals Are Down But New Home Loans are High
Mortgage deferrals are significantly down. The big four banks are all reporting similar figures, with approximately 80 percent of homeowners previously on a loan deferral now returning to regular repayments, thanks to stable or improved incomes. At the same time, new home loans are at historically high levels, due to low-interest rates and government incentives.
Like To Learn More?
For more insight and know-how into navigating the current buyers market successfully, contact Amanda Gould on 0410 608 352