Stamp duty is a charge which is applied by state governments in Australia on transactions relating to the transfer of land or property. It is paid upfront and needs to be budgeted for in addition to your loan deposit.

The amount of stamp duty you are required to pay differs in each state, however there are three factors, along with the value of the property, that will determine exactly how much. Contributing factors include:

1. whether or not the property is a primary residence or investment property;
2. whether or not you are a first home buyer; and
3. if you are purchasing an established home, a new home or vacant land.

We have stamp duty calculators available to take the guesswork out of budgeting for a property. Factoring in this additional cost cannot be overlooked when you are considering your capacity to repay a loan.

However, in a bid by state governments to stimulate home ownership and growth, there are a range of tax concessions available to reduce stamp duty. Again, exact amounts differ across each state, but those who benefit the most are first home buyers and those opting to buy a new home.

In NSW, first home buyers may be eligible for full exemption or concessions on stamp duty, under the First Home Buyers Assistance Scheme:

• Full exemption if your new or existing home is valued at less than $650,000 or a concessional rate if valued between $650,000 and $800,000; or
• Full exemption if your vacant block of residential land is valued at less than $350,000 or a concessional rate if valued between $350,000 and $450,000.