Agents rushing NSW vendors hoping to get first-home buyers before the stamp duty concessions conclude

Estate agents are rushing through listings aimed at first-time buyers in light of the September announcement that the NSW government will withdraw stamp duty concessions for first-time buyers who purchase established dwellings from January 1, 2012.

Seven out of the 12 properties on offer at last week’s specially conducted first-home buyer auction held by Ray White were sold under the hammer. First-home buyers dominated the night, and the rest of sales went to investors.

It was marketed as the Last Chance Auction.

Ray White agent Penny Timothy confirms the company is pushing people to sell before the deadline falls.

“Owners that were maybe considering selling in the next six months, we have encouraged them to do so,” she says.

“The rush to meet the deadline has bought people out.”

Under the First Home Plus Scheme, eligible first-home buyers in NSW currently receive stamp duty exemptions on all homes valued up to $500,000 and stamp duty concessions on all homes valued between $500,000 and $600,000.

On a home valued $500,000 this grant is worth $17,990.

On January 1, 2012 this will altered so the subsidy is only offered to off-the-plan homes and empty lots in an attempt to encourage new building projects.

The national first-home owner grant of $7,000 still applies.

EPS Property Search Director Patrick Bright says he has concerns that emotional first-home buyers will pay unsustainable prices for properties in a bid to save money on stamp duty costs.

“Unfortunately, when incentive schemes are in place many buyers see the money they are saving but forget to evaluate whether the current prices will be sustainable when the incentive comes to an end,” he says.

He advises investors to be very wary at this point as they will be competing with a rush of home-buyers.

“Home buyers will typically pay more than an investor, and new home buyers who have a deadline to beat could inadvertently pay a premium for existing properties in a bid to save money on stamp duty costs,” he says.

“Investors would be wise to tread cautiously in this climate to ensure they don’t get caught up in an emotional bidding war.”

Although the grant only applies to homes under $600,000, Bright says it will have a knock-on effect on more expensive properties.

”Those wishing to buy in the next price bracket from $600,000 up to $1 million may have to fork out a little more as the sellers of the sub-$600,000 properties upgrade their homes.”

Bright says he supported the decision by the O’Farrell government to tighten the stamp duty exemptions, as the savings were essentially passed on to vendors though increased sale prices.

The Last Chance Auction Results

9/24 Royston Street, Darlinghurst sold for $470,000 through Nick Harrington. It last sold in 2001 for $247,000.

701/40 Macleay Street, Potts Point sold for $553,000 through Penny Timothy.

1/8 Macleay Street, Potts Point sold for $461,000 through Penny Timothy.

12/5-7 Esplanade, Elizabeth Bay sold for $345,000 through Ian Campbell.

3/20-22 Springfield Avenue, Potts Point sold for $337,500 through Tracey Saye. It last sold in 2004 for $226,000.

14/322 Victoria Street, Darlinghurst sold for $250,000 through Laura Bitar.

107/88 Crown Street, Woolloomooloo passed in. Nick Harrington was seeking $635,000.

5/42 Bayswater Road, Potts Point passed in. Nick Harrington was seeking $320,000.

17/67-69 Macleay Street, Potts Point passed in. Tracey Saye was seeking $450,000. It last sold in 2004 for $315,000.

15/8 Macleay Street, Potts Point passed in. Tracey Saye was seeking $330,000.

77/71 Victoria Street, Potts Points was withdrawn. Nick Harrington was seeking $800,000. It last sold in 2006 for $530,000.

35/51 Roslyn Gardens, Elizabeth Bay sold before auction for $282,500 through Laura Bitar. It last sold 2001 for 176,000.