Hot on the heels of announcing 50 high-density activity centres across Melbourne, the Victorian Government has followed up with the re-introduction of off-the-plan (OTP) Stamp Duty savings.
This is a very welcome move in the right direction and applies: ✅to all buyers (not just FHBs) of OTP units ✅at any price point (not just unworkable thresholds) ❓only to strata title projects – i.e. attached dwellings. In practice this makes little differences as detached house & land already effectively enjoyed this saving ❔for a limited time – 12 months, effective now
This essentially returns us to the pre 1 July 2018 situation where buyers for OTP #apartments or #townhomes only pay stamp duty on the land component, not the full contract price. In some cases this could lead to some fairly meaningful cash savings.
What will the changes do?
✅Assist with presales on some new projects ✅Bring overall unit sales off the floor ✅Activate some dormant (existing) approvals
They will not: 🚫Cause a paradigm preference shift towards apartments away from other dwelling types 🚫Bring back investors to Victoria (given other settings) 🚫Bring back foreign investors (FIRB surcharge still exists) 🚫Bring on a swathe of new apartment approvals (due to limited timeframes) 🚫Help apartments developers sitting on completed or near-completed stock (penalising those few that continued on with projects) 🚫Make the underlying cost of development cheaper 🚫Bridge the #feasibility gap between established dwellings and new apartment stock (especially #familysizedapartments)
This is a good start but so much more needs to be done to begin solving the #housingcrisis.
I’ll keep saying it – a dogged insistence on making apartments the thing (as opposed to a thing) will continue to fall short. I hope that’s not the expectation…
🤔Looking forward to seeing what else is in the bag of tricks in Victoria’s housing announcement week.