Lesley McDonnellThe NSW Treasurer has announced changes to State taxes and grants which are being heralded as “the most generous scheme in Australia”. Let us examine three key changes.

Firstly, from 1 July 2012, the New Home Grant of $5,000 will be provided to buyers of new homes, whether off the plan or newly built, up to the value of $650,000. The same grant will be available to buyers of vacant land up to the value of $450,000 upon which a new home is to be built. This incentive is open to non-first home buyers and investors alike.

A new home is a home that has not been previously occupied or sold as a place of residence, and includes a home that is a substantially renovated home.

Secondly, from 1 October 2012 a newly named First Home Owner Grant (New Home) Scheme will be introduced for first home buyers who purchase or build a new home. It will replace the current $7,000 First Home Owner Grant from 1 October 2012. The grant of $15,000 applies to contracts signed on or after 1 October 2012 to 31 December 2013. The grant will then be reduced to $10,000 as and from 1 January 2014. The new scheme will apply to first home buyers who purchase or build a new home valued up to $650,000.

Thirdly, from 1 July 2012 the First Home—New Home scheme provides eligible purchasers with exemptions on stamp duty for new homes valued up to $550,000 and concessions on stamp duty for new homes valued between $550,000 and $650,000. The same exemption will be available to buyers of vacant land up to the value of $350,000 and concessions on duty will be available for purchasers of vacant land valued between $350,000 and $450,000 who intend to build a new home on the site.

Importantly First Home—New Home exemptions or concessions do not apply to the purchase of an existing dwelling.

Also, if you are eligible for a stamp duty exemption/concession under the First Home – New Home Scheme, you cannot receive the $5,000 New Home Grant.

Furthermore, if you are eligible for a First Home Owner Grant, you cannot receive the $5,000 New Home Grant for the same property.

If you are considering buying a new home or vacant land to build your new home on, our experienced property team can help answer all of your questions, because Helping You is Our Business.

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