Since the Property Council of Australia released figures on Monday that showed the cost of stamp duty to a home buyer with an average-sized mortgage has increased by 749 per cent in Sydney and 795 per cent in Melbourne during the past 20 years, everyone has been weighing in on the stamp duty debate. We asked three prominent real estate figures for their thoughts on stamp duty.
Julian Augustini, Director at Hodges Real Estate, said it was important to remember that the stamp duty percentage rate hasn’t changed, but the median house price has increased greatly over time, and he is in favour of a sliding scale aproach. "Buyers are paying more for properties and therefore are paying more in Stamp Duty. Back in the day, there used to be a ‘sliding scale’ approach for stamp duty when median house prices were much lower. To reflect market changes, a stamp duty sliding scale could instead be linked to the median house price. Vendors needn’t be deterred; increasingly buyers are understanding of the fees and taxes that are implicit when purchasing property.”
Ashley Playsted, CEO of Wealthie, said he supports a national uniform stamp duty structure. "Homebuyers have a wealth of information at their fingertips and it’s all about understanding how to interpret data. The rate of stamp duty has not risen, however as a direct result of higher property prices and volume of sales, the overall number paid has increased. For homebuyers, it’s about understanding they are not paying a percentage more of stamp duty; it’s just that property prices are higher overall. I would welcome a national uniform stamp duty structure. It would provide simplicity, transparency and a cross state uniformity. Interstate buyers would easily be able to investigate trans-border calculations without any surprises. It would make the market more uniform and be beneficial at a federal level.”
Meanwhile, Greville Pabst, CEO of WBP Property Group, said stamp duty worries become inconsequential for buyers who purchase the right assets that achieve capital growth. "Stamp duty varies from state-to-state, however, the threshold on stamp duty in Victoria hasn't changed. In the last two decades median dwelling prices have at least tripled, with subsequent implications for greater stamp duty revenue. However, The Property Council of Australia's findings also show rising stamp duty is a reflection of increased activity in Australian real estate markets. Stamp duties and taxes are a reality of owning various assets. When it comes to property, buyers should be mindful of selecting the right asset – stamp duty soon becomes inconsequential for high performance properties, as the cost is offset any capital growth in the long-term.”