If re-elected, the Western Australian Liberal government will cut stamp duty for downsizing seniors by up to $15,000.
The discount will apply to new and already-established homes, and will affect more than 4,000 eligible seniors aged over 65 years, according to a statement from the Liberals Western Australia.
Eligible seniors will pay no stamp duty on property worth up to $440,000, and the tax will be roughly halved on a property worth $750,000. The initiative, which will be introduced for two years from the start of 2018, will include a requirement for the senior to sell their existing home.
The policy will also give a duty concession of up to $10,000 for vacant lots.
Premier Colin Barnett said, “It is important to support seniors in choosing housing that better suits their needs.”
Seniors Minister Paul Miles said, “Our actions will not only bring major benefits to seniors and their families, they will directly support jobs – whether it be the tradies building new houses, or the professions involved in the sale of established homes.
The Barnett government already has policies in place to stimulate the languishing WA property market, including the First Home Owner Grant Scheme and Keystart.
The Real Estate Institute of Western Australia and the Council on the Ageing welcomed the release of the Barnett campaign policy.
REIWA President Hayden Groves said he was thrilled the Barnett Government had committed to easing the burden of transfer duty for seniors if re-elected on 11 March.
“Transfer duty creates a significant barrier for seniors over 65 on fixed incomes who are looking to change their lifestyle or down size," he said.
"The cost of transfer duty on a median house price of $520,000 is $18,715, which is almost equivalent to the entire annual standard aged pension of $20,745.40."
“The $15,000 concession the government have committed to will make a substantial difference to those seniors looking to 'right size' into more suitable accommodation," he said.
COTA WA CEO Mark Teale said one in three voters in WA are over the age of 60 and seniors make up 19 per cent of WA’s population.
“Our members, many of whom are on a fixed income, find the existing transfer duty arrangements to be a major barrier to ‘right sizing’, so this announcement is very positive news,” said Teale.
REIWA analysis estimates the policy reform could release 21,000 homes onto the market, making it easier for West Australians to "trade-up".
“While the concession would cost the state government $303 million from the 21,000 senior households ‘right sizing’, the resulting trade-up activity would generate additional transfer duty revenue in the order of $393 million, leaving a net surplus of $90 million," said Groves.
Ben Myers, Executive Director – Retirement Living at the Property Council of Australia, said the downsizing incentive for senior Western Australians will have broad-ranging benefits and should be examined by other states.
The peak body for retirement and seniors living has conducted its own research which shows that "downsizing to a smaller home can extend people’s capacity to live independently, delaying or reducing their need for formal care or support,” according to Myers.
Myers said the policy with "ensure senior Australians have housing choice and can downsize at low cost" but also has the benefit "of freeing up housing stock for first home buyers.”
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