Stamp duty vs land tax - everything you need to know about NSW’s First Home Buyer Choice scheme

NSW new land tax vs stamp duty scheme - which is better?

Stamp duty vs land tax - everything you need to know about NSW’s First Home Buyer Choice scheme

Eligible first home buyers in New South Wales can now choose to pay an annual property tax instead of transfer/stamp duty upfront under a new government scheme.

From 16 January 2023, first home buyers can opt to pay $400 plus 0.3% of their property’s land value annually under the NSW Government's First Home Buyer Choice scheme.

The scheme aims to reduce the upfront cost of buying property by giving first home buyers the choice between upfront transfer duty and the new ongoing property tax.

First home buyers who plan on using their property as an investment are required to pay $1500 + 1.1% of the property’s land value annually.

Eligible buyers who settled between 11 November 2022 and 15 January 2023 can apply for a stamp duty refund until 30 June 2023.

Properties valued up to $1.5 million are eligible for the scheme while vacant land can be valued up to $800,000.


Am I eligible for First Home Buyer Choice?


You will need to meet the following criteria to be eligible for First Home Buyer Choice, according to Revenue NSW:
Be an individual (not a company or trust) aged above 18

  • Be an Australian citizen or permanent resident
  • You (and the person you are purchasing with) have not owned or co-owned a residential property in Australia before
  • Have not received a First Home Buyer Grant or duty concessions
  • Signed a property contract from 11 November 2022 onwards

Land Tax or Transfer Duty - which is better?

Whether you should apply for the First Home Buyers Choice scheme depends on your personal circumstances.

Opting for a land tax could reduce upfront costs for those seeking to enter the property market, who take more than 10 years to save a 20% house deposit.

However, it is important to consider the long-term costs of an annual land tax, which will increase based on annual average wages from 2024 onwards.

Service NSW’s First Home Buyer Choice calculator can help you compare paying stamp duty or property tax.

What happens when you sell a house under the NSW first home buyer scheme?

The tax on properties subject to First Home Buyer Choice does not roll over when sold. If a first home buyer sells their property, normal stamp duty will apply to the next owner.

If the new purchaser is eligible for the scheme, they can opt to pay a monthly tax on the same property.

How do I get a refund on my stamp duty?


Anyone in NSW who bought a home after 11 November 2022 for $1.5 million or less can apply for a stamp duty refund by opting into the property tax.

A homebuyer could receive a $50,000 refund for the stamp duty paid on a median $1.2 million Sydney property, according to UNO’s stamp duty calculator.

The fee will be refunded within ten days, according to The Guardian.

The NSW Government expects over 6,5000 people to apply for a stamp duty refund annually.

Is First Home Buyer Choice the same as land tax?

Both First Home Buyer Choice and land tax are based on the value of your property’s land. However, in NSW land tax is not charged on your principal place of residence.

The FHBC scheme is also only available to eligible first home buyers.

What other concessions are NSW first home buyers entitled to?

First Home Owners in NSW may be eligible for a concession or exemption on transfer duty payable.

Homes valued under $650,000 are exempt from stamp duty under the NSW First Home Buyer Assist Scheme. Concessional rates apply to homes worth up to $800,000.

NSW also offers a $10,000 first home buyer’s grant to eligible buyers buying or building a new home.

Read our state-specific stamp duty concession guide here
Sources
www.revenue.nsw.gov.au/grants-schemes/first-home-buyer/first-home-buyer-choicewww.revenue.nsw.gov.au/grants-schemes/first-home-buyer/assistance-schemewww.revenue.nsw.gov.au/grants-schemes/first-home-buyer/new-homeswww.9news.com.au/national/nsw-first-home-buyers-choice-when-it-starts-how-it-works-eligibility-explainer/


Book Call Now

UNO home loans

Need help with your home loan?

UNO Brokers are available night and day for a quick review or your situation and bring expertise that will support better decision making that will save you time and money. Book in a quick call when it suits your busy schedule

Get Started

Related Articles

TESTIMONIALS

What our customers are saying

Sally Mackenzie
February 19, 2024
We chose Uno Home Loans from their impressive web site knowing we were going to find it hard, on many fronts, to qualify for a home loan. We were incredibly fortunate to be assigned Mike Parsons as right from the get-go, despite the complexities, he hit the ground running for us. He was incredibly knowledgeable, with years of experience but what was immediately apparent and impressive was that he was totally invested in getting us over the line, doing absolutely everything possible, including working around the clock. Despite it being a relatively small loan in the order of things, Mike never missed a beat, getting docs ready, following up and answering every request from the proposed funder immediately. He kept us informed on progress the minute anything happened, and again if anything needed to be done, he was right on it. In short, we highly recommend Uno, and Mike, knowing what a remarkable job he did, over many weeks, to get us our loan. He got us a great deal, with far better rates than we expected, so we couldn't be happier. In fact, without doubt, you'd be hard pressed to find a more personable, sharp, hard working, dedicated professional who clearly prides himself on getting his customers standout results.
Read more
Rod
February 13, 2024
Scott and his team were just A-mazing. We felt supported through the whole process with the greatest quality and care. Every question answered right in time, or even before we asked. The process was smooth and we got the best outcomes we could have wished for.
Read more
Angela Biddle
February 6, 2024
Our mortgage recently came up for renewal, and with interest rates skyrocketing we were looking for ways to minimise the impact. Michael and his team were proactive and attentive. Michael spent time with us to understand our circumstances. He found mortgage options that worked with our current financial situation and longer investment plans. He presented clear options, providing guidance where needed. He and his team were helpful and responsive - streamlining the process and keeping us updated through the negotiations. In the end, Uno did the heavy lifting and secured a significantly better rate than our current bank offered, all with friendly, personal service. We would highly recommend UNO Home Loans.
Read more
Fotis Bikas
January 15, 2024
I cannot help but congratulate Scott Wilkinson of UNO Home Loans for being an absolute credit to both his company and the entire loans industry. Scott is a truly rare gem of a broker in that he will not only go the extra mile to achieve for each customer the very best deal, but his knowledge of all and sundry within the industry is unsurpassed (you will see what I mean if you speak to him). Additionally, Scott has a clear passion for imparting his wealth of information with each customer, whereas the conversation with most other brokers would simply be over if they could not get you the best deal. For me, Scott Wilkinson of UNO Home Loans stands head and shoulders above the competition and I feel privileged to benefit both from his expertise and professionalism whenever it is time for a refinance or new loan.
Read more
Tomoharu Matsui
January 11, 2024
Michael Parsons helped me a lot when it's difficult to establish my capabilities in loan.
Read more
Gillian Kearon
January 9, 2024
I highly recommend Mike Parsons as a mortgage broker. I couldn't fault the service provided by UNO. Thanks Mike!
Read more
Taner T
December 20, 2023
Thank you Eren Tan for the amazing service and support. Our Loan was a little tricky and complex for other lenders but Eren managed to get it over the line in record time. His professionalism and dedication to our needs was exceptional. If you need a Loan no matter how complex your situation, make sure you contact Eren at UNO Home Loans.
Read more
Karaipu Brown
December 20, 2023
Buying & selling a house at the same time is very stressful but Scott Wilkinson from UNO home loans made sure we knew what was happening & took most of the stress away. He always kept us up to date and if we had a concern or wanted clarification on something we were able to call him, if he didn’t know the answer straight away he will find out and contact us back.. now we are enjoying our new house and turning it into a home :)
Read more
Chris Anderson
December 18, 2023
Just completed my first loan with UNO which was so much easier than with other other brokers I have used in the past. Our broker MIKE PARSONS always had time for me and broke things down for me in the simplest of terms and was very patient with my silly questions and my constant changing of plans. I wish I had used them in the past as I wouldn't be in the situation I'm in now. Can't recommend them highly enough. Thanks UNO and Thanks MIKE 😊
Read more
Stephen Broomfield
December 11, 2023
To be able to recommend Scott Wilkinson for your mortgage broker was a privilege. We had deals fall through but Scott supported, guided and stuck with us, proper partnership. The whole team at UNO helped us and supported us right through to after settlement. Made sure everything was correct and how we are progressing. Communication was amazing and straightforward and easy to understand. Transparent. We can not Recommend Scott and the team as Uno high enough. Use UNO with confidence.
Read more
Tarek Hussain
December 6, 2023
Can't thank Amy enough for her hard work, dedication and determination on getting multiple loans completed for me. I wouldn't hesitate in recommending Amy and the Uno team to any of my associates. Will definitely be back in the near future!
Read more
Linda
November 3, 2023
If you’re looking for a trustworthy, thorough, reliable & knowledgeable Mortgage Broker then you must call Anita Callaghan! I can’t even imagine how stressful this process would’ve been without her. Anita went above and beyond to make sure she answered every question, responded to every text (even on weekends/after hours), and followed up on every detail to ensure we had all the info we needed. Anita is a true people person who is warm, empathetic, kind and supportive. You can tell she loves helping people and loves what she does, which is probably why she’s so good at it! Can’t thank you enough Anita, or recommend you more highly! You’re the best!
Read more