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Nov 14, 2022
Stamp Duty Tax
First homebuyers can now opt to pay an annual land tax rather than stamp duty. NSW Premier Dominic Perrottet’s property tax scheme passed parliament. From 16 January, buyers can opt into the annual land tax and will not be required to pay stamp duty. Whilst it will not be fully up and running until January 16, any first homeowners who buy from now will be eligible to receive a refund on their stamp duty if they choose to switch to the annual tax. The new legislation will allow first home buyers to opt into a land tax for properties under $1.5 million, and vacant land under $800,000 and pay an annual levy of $400 plus a 0.3% tax on the value of their land. The aim of the new property tax scheme is to provide first home buyers with a choice, allowing the opportunity to purchase sooner by reducing the time it takes to save for a deposit. “People can now save huge sums of money on the biggest purchase of their life.” -Dominic Perrottet For a house purchase of $1 million it would take 23 years before reaching the value of stamp duty that would have been paid. While a unit at the same price would take 43 years. For more information on eligibility and requirements click here.
Oct 20, 2022
Spring Market Update
As we move into the second half of Spring, we wanted to provide you an overview of the property market. Here is your Spring Market Update: We have had a strong start to the Spring selling season. Our sales so far this Spring have totalled over $6.2 million in value with an average sale price of $887,000. The latest sale being the spectacular block at 5 Fitz Street which fetched $700,000. We have also had plenty happening in terms of new listings over the past week with 7 properties listed and more on the way as we enter into the back half of October. CoreLogic suggests that inflation may be moving through a peak. The ABS reported a reduction in annual inflation. With inflation slowing, the RBA has started to ease back on the rate hiking, as they took the cash rate target 25 points higher, compared with the 50-point rises seen over the last 5 months. The cash rate target is now sitting at 2.6%. The cash rate hikes are a big factor in the easing property prices, with increased borrowing costs and buyers having their purchasing power restricted. The Sydney Morning Herald suggests a 20% reduction in the size of mortgages potential property buyers can take on. Buyers may need to consider their requirements as opposed to their wish lists. We recommend re-connecting with your lender to assess and assure your pre-approval is current. Whilst this has led to the slowing of the frenzied pace of growth seen during the pandemic, regional NSW price growth is still up 9% over the year. Singleton has seen a remarkable 31.8% growth in median house prices over the last 12 months, with the median price now sitting at $560,000. Compared to the $375,000 median in 2017, it is clear the impact on demand and price patterns that the pandemic had, as the area benefited from lifestyle, convenience and affordability preferences. So far, we have seen these benefits buffer regional markets from the declines seen in Sydney and Melbourne. We are still seeing evidence of this, as we still frequently show properties to people from Sydney and Newcastle, looking for a tree change or investment. For sellers, conditions have become more challenging over the last 6 months amid the changing market. This means expectations around pricing will need to be realistic and put an added importance on pricing the property according to market conditions. When choosing an agent, ensure they know the market and are honest about the price range and not just bidding for your business. A quality marketing and sales campaign is also required to attract the right buyers. As rents continue to rise and housing values ease, gross rental yields remain on a rapid upwards trajectory. National yields are sitting at 3.6% and regional NSW yields are at 3.8%. Singleton is currently outperforming the national, and regional NSW rental yield averages, sitting at 5.1% for houses and 6.1% for units. The last 12 months has seen a steep rise in rent prices across Australia. Regarding the Hunter region, Singleton leads the way with a growth of 25%. The rental market doesn’t look to be slowing down, as prices are being driven by tight rental supply. The national vacancy rates dropped from 1.3% in June to 1.1% in September (the lowest on record). While not everyone has money saved for a deposit, as rents rise, and property values ease, those that do may look towards purchasing to avoid rising rents. We trust you find this interesting and if you would like further information or have any questions regarding the article just call us on (02) 6572 4000, drop in or send us an email. Enjoy your spring.