Housing cash splash … Premier Barry O’Farrell. Source: The Daily Telegraph
THE state’s lagging housing market will get a much-needed kick start, with the O’Farrell government extending stamp duty concessions to entice homebuyers.
As the Big Four banks yesterday finally passed on interest rate cuts, Treasurer Mike Baird said he would provide developers with a $200 million budget sweetener to build properties in growth areas on Sydney‘s fringe.
Stamp duty concessions for people who buy off-the-plan units or house-and-land packages will be extended and hundreds of millions of dollars will go towards an infrastructure fund to get homes built.
Mr Baird is expected to announce in Tuesday’s state budget that an initial two-year scheme to axe stamp duty for people buying off-the-plan – up to $600,000 – will be extended indefinitely, with the stamp duty threshold lifted to at least $650,000.
There is a trade-off. Homebuyers will receive concessions of only between 25 per cent and 50 per cent of stamp duty. The new home concession had been due to expire on June 30.
It can also be revealed that about $200 million will flow into a special fund to encourage developers to build homes in the northwest and southwest growth centres of Sydney.
The move is part of attempts to get the economy moving through the property market.
Government sources confirmed the money would fund road and sewage infrastructure, rather than requiring that developers fund the work.
To help pay for the scheme, the government will cut 10,000 public service jobs, lift speeding fine revenue by $12.5 billion and leave $2.4 billion aside to fund a major road, such as the M5 duplication.
Mr Baird has signalled a deficit of $826 million for 2012-13 followed by three surpluses. There will be a small deficit in 2011-12.
In 2010, the previous state Labor government announced the stamp duty concession for all off-the-plan apartments.
In his last budget, Mr Baird axed the concession for other first-home buyers, but kept it for those buying new homes, and raised the threshold to those properties worth up to $835,000.
The Property Council has been lobbying the O’Farrell government to retain the off-the-plan and house-and-land package concession as well as lift the threshold.