In handing down its state budget earlier this week, the Queensland government made clear it is not planning to use stamp duty as an “economic lever” as its eastern peers of New South Wales and Victoria have recently done.
According to Loan Market state manager for Queensland, Andrew Thompson, the decision is disappointing; he explained that as the state leading the nation in population growth during COVID-19, opting not to provide stamp duty relief seems sure to materially impact the rate of Queensland’s economic recovery.
“Refinancing spiked in the middle of 2020, but the second half of the year has been driven by finance for new purchases and investments,” Thompson said.
Queensland having attracted the most interstate migration of any state over the June quarter, according to Australian Bureau of Statistics data, resulted in a wave of enquiries to Loan Market’s Queensland mortgage brokers; in the last 90 days, they’ve settled almost 2,000 loans – an increase of 9.1% from the same period in 2019.
According to Thompson, brokers based in “lifestyle regions” like the Gold and Sunshine Coasts are reporting a notable surge in activity as people explore more flexible work arrangements.
While Thompson believes the “fundamentals are strong” for the real estate sector in Queensland, he believes stamp duty reform would have made it easier “for buyers to get into the market or upgrade and generate more activity for everyone from tradesmen to conveyancers”, further contributing to the state’s economic recovery.
“Queensland’s appeal is clear to see with our population still growing despite the absence of international migration,” Thompson said.
“It’s unfortunate that Queensland home buyers won’t receive the same property incentives that have been outlined for their southern peers.”
In November, the New South Wales government proposed replacing the upfront stamp duty with a smaller annual land tax, while the Victorian government is temporarily providing a 50% stamp duty discount for the purchase of new homes valued up to $1m and a 25% discount for those buying existing homes up to the same value.