The NSW Government delivered the 2010-11 Budget with a number of key wins for the property industry. From July 1, stamp duty will be abolished for the next two years for any purchasers buying a home worth up to $600,000, prior to the commencement of construction. This is a potential saving of up to $22,490.

Stamp duty will be cut to zero for people buying a home or apartment worth under $600,000 off the plan.

There will be a stamp duty cut of 25 per cent or up to $5,623 for anyone buying a new home already under construction or newly completed worth up to $600,000.

Stamp duty will also be eliminated for the next two years for anyone over 65 who sell their property and move into a newly built dwelling worth up to $600,000. This is being done as an incentive to encourage empty nesters to down-size to smaller homes.

NSW treasury expects between 1,000 and 2,000 seniors to take up the offer annually at a cost of $10 million in each of the next two years.

First homebuyers will also be eligible for the cuts (they were not eligible for last year’s 50% cut to stamp duty on new homes).

The stamp duty cuts follow other plans announced last week by the State Government to drive supply of new housing construction. These include:

•    Strict enforcement of a cap of $20,000 per residential lot for section 94 contributions (infrastructure contributions paid to council by property developers)

•    Any justifiable requirement for infrastructure spending above the cap will be converted to an ongoing special rate variation

•    Both s94 contribution plans and annual local government rate caps will be removed from ministerial discretion and given to IPART for assessment and approval.

•    Funds to speed up the finalisation of LEPs, improve the ‘spot rezoning’ system and give financial incentives to councils that swiftly process DAs.

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