Don't rush just for 'freebies', FHBs urged

by Adam Smith08 Dec 2011

Property experts and brokers have urged NSW first homebuyers not to jump the gun in a rush to beat the state's stamp duty deadline.

With the 31 December stamp duty deadline exemption looming, MPA Top 100 Broker Daniel O'Brien said savings from stamp duty could be erased by inflated purchase prices.

"I would advise them [buyers] to do their homework  to establish that they aren’t paying an inflated price, due to the current first home buyers rush," he told Australian BrokerNews.

O'Brien urged first homebuyers who felt they were getting a good price to "go for it", but said missing the stamp duty deadline would not be "the end of the world". He predicted that a smaller pool of first homebuyers in 2012 could lead to lower prices from vendors.

The warning follows that of PRDnationwide research analyst Oded Reuveni Etzioni who has also urged first homebuyers not to rush their decisions.

"We see the purchase of real estate as a long term investment and therefore suggest that first home buyers conduct a thorough research of the market and make sure they buy at the right price," he said.

"This will help to ensure that the longer term movement of the market will not erase the short term impact of stamp duty savings."

Etzioni said the "short term impact" was negligible enough to be easily erased in a market downturn.

Regardless of the drawbacks of rushing to beat the deadline, O'Brien said his business, PFS Financial Services, has seen a massive rush of first homebuyers as the year draws to a close.

"We haven’t seen such a first homebuyer rush since the reduction of the first homebuyers grant in 2009. The same thing happened then that is happening now: Freebies are reducing, so people are moving at a hundred miles an hour to get in before the freebies end," he said.

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Stamp duty deadline to spur FHB rush