Legal Comment by Mark Illidge

January 2007

The start of 2007 will be welcomed by first-homebuyers of vacant land, with new stamp duty reductions introduced by the State Government in recognition of rising house prices.

From 1 January 2007 a new stamp duty concession has been available for the purchase of vacant land by first-homeowners.

No transfer duty is payable where the value of the land is up to and including $150,000.00.  The concession progressively reduces as the value of the land increases until the value of the land reaches $300,000.00.  If the purchase price is $300,000.00 or more the concession does not apply and full transfer duty is payable.

With the introduction of the new concessions first-homebuyers will pay $550.00 in duty for a block of land worth $160,000.00. This is a saving of $3,750.00.

However there are a number of conditions that apply to qualify for the concessions:

• The concession is only available to individuals who acquire the land to construct their first home and intend to occupy it as their principal place of residence.
• The concession will not apply to a corporation or a trustee of a discretionary or unit trust.
• The changes only apply to contracts entered into after 1 January 2007. Therefore a contract entered into prior to 1 January 2007 that is due to settle after 1 January 2007 will not attract the concession and full stamp duty will have to be paid.
• At the date of acquisition of the land there must not be any part of a building on the land.
• The purchaser must occupy the land as their principal residence within 2 years from the date of settlement.

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