Victorian investors lose OTP stamp duty concessions

The Victorian government has abolished stamp duty for first home buyers for purchases below $600,000.

Those buying a home valued between $600,000 and $750,000 will be eligible for a concession from the Andrews Labor Government from July 2017.

The exemption and concession will apply to both new and established homes, in a move that is expected to help 25,000 Victorians find their first home.

The Government will also remove off-the-plan stamp duty concessions on investment properties, described as "a further move to help tilt the scales back towards home owners."

The off-the-plan stamp duty concession will now be available solely for those who intend to live in the property or who are eligible for the first home buyer stamp duty concession.

The stamp duty for off-the-plan investors will raise almost as much as axing stamp duty for low-price first home buyers will cost, it has been advised.

At the same time, a Vacant Residential Property Tax will be introduced to address the number of properties being left empty across inner and middle suburbs of Melbourne.

Under the changes, owners who unreasonably leave these properties vacant will instead "be encouraged to make them available for either purchase or rent."

The Vacant Residential Property Tax will be levied at 1 per cent, multiplied by the capital improved value of the taxable property.

For example, if the property has a capital improved value of $500,000, the amount paid will be $5,000.

There will be a number of exemptions, recognising there are some legitimate reasons for a property being left vacant, including holiday homes, deceased estates and homes owned by Victorians who are temporarily overseas.

Premier Daniel Andrews said in the past, "if you worked hard and saved enough, you could afford to buy your own home. Now, that’s getting harder and harder.

“These changes will help thousands of Victorians make the Great Australian Dream a reality.”

“With negative gearing and capital gains tax concessions, the odds are already stacked against first home buyers.

"This will help level the playing field.”