With one-third of all unit purchases in 2020 estimated to be off-the-plan, REIWA is calling on all political parties to maintain this momentum by formalising the stamp duty rebate for off-the-plan purchases if elected.
REIWA President Damian Collins said it was important the off-the-plan stamp duty rebate becomes a permanent feature of Western Australias property tax system to secure ongoing construction jobs and limit urban sprawl.
The current 75 per cent stamp duty rebate for off-the-plan construction apartments has been essential in ensuring an ongoing pipeline of projects. We firmly believe that without this ongoing incentive, the demand for WA apartments will soften, impacting the steady supply of diverse housing and the creation of jobs for West Australians, Mr Collins said.
Off-the-plan apartment buyers face unfair burden
Prior to the rebate, when an off-the-plan apartment was purchased, the buyer paid stamp duty on the combined value of the land and build, however a house and land package is taxed solely on the value of the land. |2021
This discrepancy puts an unfair financial burden on those looking to buy off-the-plan and forces some people to look elsewhere, in some cases pushing people to buy in Perths outer suburbs. This is in direct contradiction to the WA Governments commitment to reducing urban sprawl and promoting infill developments, Mr Collins said.
The 75 per cent rebate currently in place is countering this issue in the short term. Unfortunately, once the rebate program ends in October, apartment buyers are back to being significantly disadvantaged.
If our state is going to continue to recover from the economic impacts of COVID-19, we need to ensure apartments remain desirable for buyers so there is a healthy supply of construction projects and jobs available.
