The temporary off-the-plan duty concession applies from 21 October 2024, and allows a 100% deduction of outstanding construction and refurbishment costs when determining how much stamp duty is owed.

The new concession will be available to all off-the-plan purchases and will allow the purchaser to deduct the construction costs incurred on or after the contract date when determining the dutiable value of the purchaser’s property.

In other words, the amount of stamp duty paid will be calculated based on the cost of the land prior to construction, not the total price of the finished property.

Example: A Victorian buys an off-the-plan apartment for $620,000. The land was valued at $77,500 so they would pay just $4000 in stamp duty, rather than $32,000 – a substantial $28,000 saving.

What types of properties are eligible?

An eligible apartment, unit or townhouse is one that is in a strata subdivision – meaning they retain common property such as a driveway or a shared hallway.

Are house and land packages eligible?

No, house and land packages are not eligible for the extended stamp duty concession.

House and land packages or other dwellings that are not part of a strata subdivision are not eligible for the extended concession, but first-home buyers and owner occupiers can still utilise the existing concession on these properties. The existing concession will continue to apply during and after the 12-month extension.

Are new apartments and townhomes that have been completed but not lived in yet eligible?

No. Contracts signed before the commencement date of this concession, but settled during the 12-month window, are ineligible.

Off-the-plan concession eligibility is determined based on the date you sign your contract. 

As long as you sign your contract within the eligibility period, being on or after 21 October 2024 for a period of 12 months, you will be eligible for the off-the-plan concession regardless of when you settle the transaction.

For developments currently under construction, buyers are also eligible for reduced stamp duty, but the savings depend on the amount of construction completed at the time of purchase.

What is the price cap on eligible homes?

There is no price cap on eligible homes.

What are the eligibility requirements for buyers?

The concession will be available to all purchasers, including investors, companies and trusts, meaning there would be no requirement to be eligible for either the principal place of residence duty concession or the first home buyer duty exemption or concession.

The existing off-the-plan concession for owner-occupiers and first home buyers will continue to apply.

Is there an income limit for those eligible?

There is no income limit for eligibility.

Are foreign buyers eligible?

Yes, foreign buyers are eligible, however the concession does not apply to foreign purchaser additional duty (FPAD) as this is calculated on the dutiable value of the property before any off-the-plan concession is applied.

The off-the-plan concession will only apply to the general land transfer duty liability.

When does the scheme start?

21 October 2024.

How long does the scheme last

One year, until 21 October 2025.

The temporary off-the-plan duty concession is a time-sensitive initiative. Prospective buyers should act promptly to take advantage of the scheme, as the concession will revert to its previous set up after the 12-month period ends.

( Source : realestate.com.au Sonia Taylor, New Homes Editor 22 Oct 2024 )