[NEW VIDEO]: Victorian Government Slashes Stamp Duty For Off-The-Plan Townhouses on 21st October 2024

Dear Fellow Property Investors,

Victorian government's stamp duty cuts on off-the-plan apartments, units, and townhouses offer significant savings for property buyers. Learn more about eligibility, how to benefit, and why now is the prime time to buy with these expanded concessions.

In a significant policy move aimed at stimulating the property market, the Victorian government has announced a major reduction in stamp duty for off-the-plan apartments, units, and townhouses.

Effective from October 21, 2024, the expanded concessions will apply to all eligible off-the-plan purchases and will remain in place for one year.

This initiative, designed to address the state’s housing affordability crisis, opens a window of opportunity for prospective buyers, particularly investors and owner-occupiers, to secure substantial stamp duty savings.

Key Changes to Stamp Duty Concessions;

Previously, stamp duty on off-the-plan purchases was calculated based on the total price of the property, including the construction value. Under the new scheme, stamp duty will be calculated solely on the land value before construction begins. This shift in policy significantly reduces the financial burden for buyers, particularly in metropolitan areas where property prices continue to rise.

For example, a Victorian purchasing an off-the-plan apartment valued at $620,000, with the land component valued at $77,500, will now pay just $4,000 in stamp duty—down from $32,000. This $28,000 saving represents a significant reduction in upfront costs for property buyers, potentially unlocking the market for a wider demographic.

The changes also eliminate the previous cap on concessions, expanding eligibility beyond first-home buyers to include any purchaser of off-the-plan apartments, units, or townhouses within a strata subdivision.

Who Benefits from the Scheme?

The new stamp duty concessions are aimed at boosting sales in Victoria’s off-the-plan sector, which has been slowing due to high taxes and market uncertainty. The scheme covers properties that are part of a strata subdivision. However, it excludes house and land packages or dwellings not part of a strata subdivision.

Existing concessions for first home buyers remain unchanged. Homes valued up to $600,000 will continue to benefit from full stamp duty exemptions, and concessions apply to properties valued up to $750,000.

A Limited-Time Opportunity for Buyers

The stamp duty concession is a time-sensitive initiative, with the expanded benefits available only until October 21, 2025. Buyers who are considering entering the market are urged to act promptly to take advantage of the scheme, as the concession will revert to its previous structure after this period.

For developments currently under construction, buyers are also eligible for reduced stamp duty, although the exact savings will depend on how much of the construction has been completed at the time of purchase.

What Buyers Need to Know;

For those interested in purchasing an off-the-plan property, feel free to contact Konrad Bobilak CEO of www.investorsprime.com.au via 

Summary of Eligibility:

• Applies to off-the-plan apartments, units, and townhouses within a strata subdivision.
• Stamp duty is calculated based on land value, not total property price.
• Available for one year, ending October 21, 2025.
• No cap on eligibility; open to all buyers, not just first-home purchasers.
• With the Victorian government’s stamp duty concession, now is an ideal time for property buyers to enter the market while this limited offer remains available.

Interested in getting educated on Australian property investing?

Reserve your place and join me and 55 like-minded property investors for the final Real Estate Investing Fast Track Weekend for 2024!

Click HERE to reserve your seat now!

You may need to pay land tax if you own an investment property, holiday home, commercial property or vacant land.

What is land tax?

Land tax is an annual tax based on the total taxable value of all the land you own in Victoria, excluding exempt land such as your home (principal place of residence).

Land tax is calculated using the site values (determined by the Valuer-General Victoria) of all taxable land you owned as at midnight on 31 December of the year preceding the year of assessment. 

You may have to pay land tax if you own, either individually or jointly with others:

• investment properties, including residential rental properties
• commercial properties such as retail shops, office premises and factories
• holiday homes
• vacant land.

Land tax assessments are generally issued between January and June each year. 

Land tax exemptions 

Land tax does not apply to exempt land such as:

• your home, known as your principal place of residence (PPR)
• your farm, known as primary production land (PPL)
• rooming houses and charitable institutions.

If you start leasing your home (your principal place of residence) or change your address, the exemption ends and you must notify the ATO immediately. 

Paying your assessment 

There are 3 ways to pay your land tax assessment – via credit or debit card, BPAY, or in instalments via AutoPay.

If you choose AutoPay, you can pay your land tax assessment in fortnightly, monthly or in four equal payments up to 38-weeks from the issue date on your assessment. AutoPay instalments must be set up annually as instalment amounts can change depending on your tax liability.

You can create an AutoPay arrangement via My Land Tax. It is important to pay or set up a payment arrangement on time to avoid late payment interest and recovery action. 

Land tax trust surcharge

Land held on trust for a fixed, discretionary or unit trust is generally assessed at trust surcharge rates of land tax. The trust surcharge does not apply to land held by an administration trust, an excluded trust or an implied or constructive trust.

The trust surcharge rates are higher than general land tax rates and apply once the total value of the taxable land held by the trust is $25,000 or more. When the total value of the taxable land is $3,000,000 or more, there is no difference between the general and trust surcharge land tax rates.

If you tell us about the beneficiaries of the trust, we may assess the trust at general rates and may also assess the beneficiaries for their interest in the trust land in any individual assessments they receive.

Absentee owner surcharge

If you are the trustee of an absentee trust, the absentee owner surcharge applies to the trust’s taxable land. The absentee owner surcharge is additional to the land tax you pay at general or trust surcharge rates.

The surcharge is 4% from the 2024 land tax year (previously 2% for the 2020-2023 land tax years, 1.5% for the 2017-2019 land tax years and 0.5% for the 2016 land tax year).

An absentee trust is a discretionary trust, a unit trust or a fixed trust, which has at least one beneficiary who is an absentee person. If you are the trustee of an absentee trust that owns taxable land, you must also tell us you are an absentee owner.