Big stamp duty discount for Perth apartments

The Western Australian (WA) government has announced it will offer a substantial stamp duty rebate for off-the-plan apartment purchases in the state.

As of October 23, 2019, purchasers of off-the-plan apartments will receive a rebate of 75% of their stamp duty, capped at $50,000.

“This new Western Australian jobs initiative will drive investment into our local residential construction industry and support the WA property sector,” WA Premier Mark McGowan said.

The new stamp duty rebate is a substantial incentive for buyers to upsize, downsize or invest and is expected to boost demand, and further contribute to jobs growth in the region.

— William Mitchell, Ironfish Head of Property

Who can apply?

The rebate will be available for two years to any purchaser of a dwelling in a multi-storey apartment building – whether owner-occupier, first-home-buyer, investor or overseas buyer.

No cap will be placed on the purchase price and multiple rebates will be available to the same applicant for additional unit or apartment purchases within the same or different developments. However, the development needs to be completed within 36 months.

Overseas (FIRB) buyers will also receive a 75% rebate on the foreign buyers duty payable.

When will you receive the rebate?

Eligible applicants can apply for the rebate within 12 months from the date of registration of the certificate of title of apartment.

For example:

James enters into a pre-construction contract in January 2020 to purchase an apartment in a multi-tier development for $1,000,000.

Construction is completed in December 2021 and titles are issued in January 2022. Settlement occurs and James pays duty of $42,615.50 at the residential rate.

Three months after the settlement date, James applies for the rebate. James is paid a rebate of $31,961.62, which is 75% of the duty he paid on the contract.

What does this mean for Perth property buyers?

The Perth market has already been showing positive signs of recovery. During November, prices rose by 0.4 per cent in the Greater Perth region, with a median value of $470,000 for houses and $335,000 for units.

The “Diversify WA” employment plan, led by the government and creating 150,000 jobs, was launched this year, the rapid development of electric vehicles globally has brought strong demand for lithium;– and the vacancy rate has decreased dramatically, making Perth a significantly tighter rental market than Sydney.

Further, Perth has recently been reclassified as a regional area this year, which will increase its appeal for overseas migrants looking to expedite their permanent residency applications and thus positively stimulate population growth.

“The new stamp duty rebate is a substantial incentive for buyers to upsize, downsize or invest and is expected to boost demand, and further contribute to jobs growth in the region,” said Ironfish Head of Property, William Mitchell.

“For foreign buyers especially, there is a significant saving on offer, which makes Perth an attractive Australian city in which to invest.”

Ironfish has a dedicated in-house property research division which monitors the major Australian capital city markets and identifies investment properties to recommend to our customers. To learn more about the Perth market or find out about our recommended properties, register your interest below.

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