Media Release
The Real Estate Institute of Victoria Ltd
Telephone (03) 9205 6666
ABN 81 004 210 897
Monday 25 October 2009
REIV calls for stamp duty cuts and first home buyer assistance
The REIV has released its policies for the November 27 Victorian State Election, calling for improved
housing affordability, reduced business costs, increased supply of housing and more assistance for all
first home buyers.
REIV CEO Enzo Raimondo said that due to the healthy economy and growing population, housing
affordability was under extreme pressure and steps need to be taken to help buyers and renters.
“With the right policies the state government can improve housing affordability, particularly for first
home buyers.
“The first problem is stamp duty; home buyers are paying more in stamp duty than ever before. Ten
years ago stamp duty on a median-priced house was $9,760, or 4.15 per cent of the purchase price –
now its $28,970 or 5.13 per cent of the purchase price.
“Last financial year the state government exceeded budgeted income by $408M and due to the
strength of the market they look likely to exceed this year’s budget as well. The extra income received
from home buyers last financial year would cover the cost, over four years, of the cuts to stamp duty
made in 2007.
“If stamp duty were charged on the same rates it was 10 years ago, the buyer of a median-priced
home would save over $5,000 – money that could be spent on a range of other items necessary to set
up a new home.
“The issue is not whether or not stamp duty should be charged – we agree with the state government
that it should be eliminated – the issue is why Victorians have to pay more than they did 10 years ago.
“The second problem is that first home buyers are worse off than they were a decade ago. When the
$7000 grant was introduced in 2000 the median price of a house was less than half what it is now.
“While the grant has not increased, stamp duty has. As it stands, the first home buyer grant is simply a
small down-payment on the stamp duty bill.
“The state government has a policy of helping new home buyers with very generous grants but that
has not stopped the number of first home buyers dropping by 45 per cent over the last year. First
home buyers are clearly struggling with increases in the cost of housing. They deserve relief.
“Victoria should follow the lead of NSW, Queensland, the Northern Territory and Western Australia
and provide a 100 per cent discount on stamp duty.
“It is also necessary to increase the supply of housing to ease cost pressures on owner–occupiers and
renters. Melbourne has an undersupply of housing and only by increasing house construction can that
be addressed,” Mr Raimondo concluded.
MEDIA COMMENT:
Robert Larocca, 9205 6622 or 0409 198 350
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