Of all the hurdles first time homeowners have to clear, government taxing stamp duty has been the most off-putting. Especially for young salary earners looking to take the leap into buying their own home. But if you’re looking for a consolation prize, Queensland actually ranks as one of the more affordable states compared to New South Wales and Victoria especially – at least when it comes to property taxing and GST.
Queensland has the cheapest government charges, with a house purchase costing the buyers $93,000 in deposit and government taxes, on a $465,000 median price according to a study by realestate.com.au
Meanwhile, Victoria will expect you to put up $109,835 for a house and $102,429 for a residential unit and NSW asks you to cough up deposit and stamp duty costs of $118,948. That still doesn’t put out the fiery debate between millennials and baby boomers – a never-ending finger pointing game of who ruined the property market first.
Perhaps you’re looking to invest in a home early for future asset planning, or you and your partner have your eyes on that dream house. Sometimes that dream can end up being a nightmare, and with the property market in the state it’s in we’re walking into the film set of Nightmare on Sydney’s streets. So what can you do?
1. Don’t gun for the dream house straight away. Choose properties based on their predicted market value in future and whether you can use it as a tax asset. Property can become a source of income down the track. Talk to one of our income tax professionals about best future planning practices.
2. Consider a buyer’s agent to help you find the ideal property for your budget. But remember – they’re not free. Though a buyer’s agent’s fees aren’t tax deductible if you solicit them to help find your new residential property, property management fees for letting your property as a rental are.
3. Despite Turnbull’s gaffe earlier this year suggesting first time home owners should ask their parents, it’s not an option to discard lightly. Whether it’s decided to put up money as a gift, or set it out as a loan it will also affect your parents’ tax declarations. Find your nearest ITP Qld store to discuss the options.