Stamp duty scrapped for first-home buyers, government help to buy a home and millions more to be spent on accelerating planning decisions - those are the key announcements made in this year's NSW budget as the state government attempts to tackle chronic housing unaffordability.
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Stamp duty
This was the key announcement of the state budget, despite representing a significant watering down of what had been expected.
First-home buyers purchasing a property valued up to $1.5 million will be able to choose to pay a land tax rather than stamp duty from January 2023.
The land tax will be calculated at 0.3 per cent of a property's unimproved land value, plus $400 each year. If it is converted to an investment property, the land tax rate will be 1.1 per cent and $1500 per annum.
Buyers paying up to $800,000 will still be eligible for stamp duty exemptions or concessions, and future buyers of the property can still choose between land tax and stamp duty.
Planning acceleration
The government has already announced nearly $500 million in funding to "supercharge" the approval of new housing, including $300 million to co-fund 'shovel ready' infrastructure projects.
The proposal also includes $33.8 million to help establish a 10-year regional housing supply pipeline.
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Other parts of the $500 million spend include $89 million to accelerate approval of new housing, as well as $69.8 million to expedite the rezoning of housing precincts.
Minister for Planning and Minister for Homes Anthony Roberts said that the commitments reflected the need for improved infrastructure delivery in the regions.
"One of the key recommendations from the Regional Housing Taskforce was the lack of infrastructure being built in our regional communities. This investment will help regional NSW keep up with current and future demand," he said.
Shared equity scheme
A shared equity scheme similar to that promised by the federal government and several other states, including Victoria and Western Australia, was announced by the NSW government.
It would see the government take a stake of up to 40 per cent (for new homes) and 30 per cent (for existing homes) in a participant's home.
In return for the government being able to share in future capital gains, participants will be entitled to lower monthly repayments.
The government estimates that someone purchasing an existing home worth $600,000 could save $180,000 on the initial purchase price, with mortgage payments $860 less per month than if they had to fund the entire purchase without government support.
The scheme will operate for an initial period of two financial years, with 3000 participants accepted each year.
Participants will be subject to strict eligibility criteria and is also only open to first-home buyers who work as teachers, police or nurses; single parents with at least one child under 18; and a single person 50 years or above.
Land tax rates for property investors, foreign owners
The budget wasn't all good news for property buyers and owners, with some new taxation measures introduced in an attempt to claw back revenue.
Property investors with more than two properties will lose some of the discount they had previously enjoyed for paying their land tax early. The discount of 1.5 per cent has been slashed to 0.5 per cent.
Foreign property owners who own land in NSW will also face a heftier tax bill, with the current 2 per cent surcharge they pay on land tax set to increase by double to 4 per cent.
