What the new first home buyer concessions mean for the Newcastle property market
As has been widely reported, July 1 marked the first day of the NSW Government’s increase to support packages for first home buyers. Designed to bring some much- need relief for first home buyers entering the market – who often face stiff competition from investors – the Government’s updated package includes the introduction of the following measures:
- Abolish stamp duty on all homes up to $650,000
- Give stamp duty relief for homes up to $800,000
- Provide a $10,000 grant for builders of new homes up to $750,000 and purchasers of new homes up to $600,000
- Abolish insurance duty on lenders’ mortgage insurance
- Ensure foreign investors pay higher duties and land taxes
- No longer allow investors to defer paying stamp duty on off-the-plan purchases.So what does this mean for first home buyers in Newcastle?While obviously this is welcome news for First Home Buyers across the country, in Newcastle specifically it means the barrier to entering the market has been lowered significantly. With this comes the fact that the scope of properties available to first home buyers has also now widened greatly. Whereas prior to the legislation most first home buyers were limited to outer suburbs, now they can also consider inner-city areas.And apart from the lifestyle appeal and conveniences associated with inner-city living is the additional benefit of financial security. Most inner-city properties, such as apartments, terraces, townhouses and the like have a track record in steadily increasing in value over time and at the very minimum retaining it.
And how does this affect the greater Newcastle property market?
As most Novocastrians will be well aware, the Newcastle property market has been seeing significant steady growth. In fact, recent figures from BIS Oxford Economics indicate that the Newcastle market is expected to experience growth of 11.4% in 2017 and 5.4% in 20181.
Reasons for this vary but include:
- ‘Revitalisation’ of the Newcastle CBD – positive impact from new infrastructure the light rail, transport interchange at Wickham and the $95M University ‘New Space’ Building – now operational. The New Space – inner city campus building is bringing 3000 students into the CBD.
- Increased role of Newcastle as a logistic hub
- Strong employment growth in construction and tourism. Unemployment 5.5% March 17.
- Increased home affordability compared to Sydney leading the increased migration to the area.
Well and truly gone are the days in Newcastle’s not-so-recent past following the closure of the steel works, where the city was suffering from an identity crisis that saw most store fronts on Hunter St empty and a lack of certainty dictating house prices. With growth and confidence in the city now in abundance there has never been a better time to own property in Newcastle.
When the heart of the city is strong it resonates outward. And the city is now booming, which means home owners and investors can also enjoy the long-term benefits, which come from that certainty and stability.
So all in all, the new first home buyer policies are good news for first-home buyers, current home owners and the Newcastle property market and city alike. Click here for more information on Newcastle’s residential and commercial property market.
1 BIS Oxford Economics Residential Prospects 2017-2020