Homeowners are electing to undertake renovations rather than sell their properties in an attempt to avoid stamp duty, according to the Real Estate Institute of New South Wales.
REINSW President John Cunningham said the number of property transactions had hit a four-year low for the month of October 2016 according to data from the NSW Office of State Revenue.
“The number of Land Related Transactions transactions in October 2016 was 17,312, almost 12 percent less than the same period last year and at levels last seen in 2012.
“There were 55,745 transactions for the first 3 months of the 2016/2017 financial year down 7 per cent on 2015/2016. The fall in transactions saw a decline in government revenue of more than 4 percent to $2.0643 billion,” Mr Cunningham said.
“Latest building approval data from the ABS highlights what we had been suspecting for some time, homeowners are electing to renovate and add value to their properties rather than throwing money away though stamp duty associated with purchasing a new home.
“It is time for the NSW government to recognise this trend and review stamp duty levels. It is totally unacceptable that the government has allowed stamp duty levels to remain unchanged for 30 years.
“A review of stamp duty rates would result in more transactions and would benefit not only residents of NSW but would act to increase revenues that are currently in decline,” Mr Cunningham said.