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Author: Real Estate Institute of Australia
Stamp duty has become the antiquated blight of the
Australian housing sector as prices soar and governments continue to penalise home
buyers with higher taxes which is leading to a reduced number of properties on
Real Estate Institute of Australia (REIA) and SQM Research
have released a market analysis titled Stamp duty: The relationship to Australian
housing affordability and supply, which shows that listings have plummeted
across the country as housing prices and taxes on sales skyrocket.
According to the report, total national property listings
have been steadily falling over the past year to currently sit at just over 200,000
properties – a record low on SQM’s numbers.
By way of comparison, between 2011 and 2019, a period that
recorded two upturns and one downturn, national available listings ranged
between 380,000 to 300,000 dwellings.
“As a result, market liquidity has nearly halved. In 2008,
up to 4.5 per cent of all residential properties were available for sale at any
one point in the market. Today the percentage available is below 2.5 per cent,”
the report found.
REIA President Adrian Kelly said stamp duty remains a
prohibitive tax for all buyers, adding tens of thousands of dollars to the purchase
of a home – for empty nesters, paying tens of thousands of dollars on a home
they may only need for five years means less properties will be placed on the
“Stamp duties as a percentage of average national earnings
have jumped over the past decade to 34.3 per cent from 25.1 per cent recorded
back in 2012, up almost one third. In Sydney and Melbourne, stamp duties alone
can represent nearly half the average annual income,” Mr Kelly said.
Mr Kelly said transfer duties as a percentage of median
property prices have jumped in most capital cities over the nine years between
the March quarter of 2011 and March 2021 because of rising property prices.
“First home buyers are borrowing more to accommodate higher
stamp duties and affordability is reducing.
“In real terms, at current median income and rising housing
prices, had stamp duty remained at the 2012 amount, home buyers would save an
average nation-wide of $21,000 with Victorians saving a whopping $35,000, or
half an annual median salary in Australia,” Mr Kelly said.
Louis Christopher, Managing Director of SQM Research said
the study has found there has been an ongoing decline in listings over the past
“The decline in listings has been occurring despite the
steady increases in total dwellings across Australia and even through the
various housing cycles,” Mr Christopher said.
“The long-term decline in listings fundamentally represents
a shortage of real estate which is contributing factor to the surge in prices.
“While there maybe various reasons for this situation, we
believe stamp duty bracket creep is a leading contributor. When transaction costs
of transferring properties disproportionately rise compared to dwelling prices
and incomes, (as what we have found) then that must be a massive disincentive
for property owners to move house.”
For more information about REIWA’s position on stamp duty,
read the stamp duty reform
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