Victoria cuts stamp duty for new builds

1 month ago 3

Melbourne supply

Melbourne has been faring reasonably well when it comes to approvals for detached homes (certainly as compared to Greater Sydney).

On the other hand, unit approvals have really approved since the previous cycle, when a lot of buyers were burned buying off-the-plan and sucking up capital losses.

Stockland reported in its 1Q25 update today that both net sales and enquiries in New South Wales are down by around 50 per cent, while net sales in Victoria were down by about 30 per cent.

Mirvac's Chief Executive noted last week at a Citi conference that the housing crisis could last for years, in part because government infrastructure investment and spending is chewing up the construction workers and capacity in Sydney.

Stamp duty slashed

Victoria's state government announced today that stamp duty will be slashed for all off-the-plan apartment purchases for the next 12 months.

You can always be assured that reform in Australia will come in the form of demand-side stimulus measures.

Whether this proves to stimulate new supply will be an interesting one to watch.

Such measures have often proven to be effective because consumer love the idea of a discount or getting something for nothing.

On the other hand, there are still capacity issues in the construction sector, and profit margins at today's prices are still likely to be very thin.

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