Calls to keep stamp duty exemption for first home buyers in Western Australia continue
The Real Estate Institute of Western Australia (REIWA) has stood up or the rights of first home buyers across the state this month, warning the State Treasurer against scrapping the stamp duty exemption for these buyers in the May budget. This helps to make the prospect of purchasing real estate in the state easier by making the overall charges involved smaller than normal.
REIWA President David Airey said that the government's plans to cut costs and increase revenue must be done with great care and not disturb the opportunities associated with introducing more first home buyers into the residential property market.
"We are gravely concerned that the government might be tempted to increase stamp duty for all buyers and scrap the stamp duty exemption for first home buyers. The property market in WA is only just stabilising after several volatile years, while current REIWA data indicates a market downturn for the second half of this year," said Mr Airey in an April 4 statement.
He went on to say the current policy settings are working to help the market recover and should be retained in order to keep this "fragile market" from collapsing in on itself. Furthermore, having a higher demand from first home buyers who are enabled by government policy will help increase the overarching supply of property in the market - infusing the local economy as more people begin to invest and build.
After being introduced in 2007, the stamp duty exemption for first home buyers has been considered a great success - especially when it comes to nurturing the market back to strength.
"Cost of living and housing affordability is much tougher in WA than it is in other states, but removing the stamp duty impost from first home buyers saves most of them around $14,000 and helps them get into a home of their own," said Mr Airey.
"In combination with low interest rates, first home buyers have flourished in WA but the signs are that this is now trending downwards and it would be devastating if they soon get hit with stamp duty."
Furthermore, Mr Airey highlighted New South Wales as an example for keeping the exemption. The state recently removed tax exemptions for first home buyers and has seen activity in the market collapse in the interim. Therefore, it could be a great idea for Western Australia to retain the stamp duty exemption and contribute towards the development of a strong real estate market in the state.