A new tax imposed on foreign investors buying property in New South Wales is to be introduced from next week.
From 21st June, a 4 per cent stamp duty surcharge will be placed on any house purchase by a non-Australian resident, while from next year a further 0.75 per cent land tax surcharge on foreign purchasers.
New South Wales becomes the second Australian state to place increased taxes on foreign property purchasers, following the lead of Victoria. In April it was announced that from 1st July Victoria will increase the stamp duty surcharge for foreign buyers to 7 per cent from 3 per cent.
The measure in New South Wales, which will need to be paid in addition to the stamp duty that applies to all buyers, is expected to raise more than AUS$1 billion over four years.
Currently, home buyers in New South Wales pay AUS$40,490 in stamp duty on a property worth more than AUS$1 million, plus 4.5 per cent of the value above A$1 million.
In recent months the average price of a property in state capital Sydney has risen above the AUS$1 million mark. An increase in foreign buyers has been cited as one of the main drivers of the price growth seen in NSW’s booming property market in recent years.
Article by David Fuller