OT: Current Affairs and Politics

[Bandwagon]

Who would pay? I mean if you just forked out stamp duty in the last 3 or 4 yrs you would feel like it's double dipping.

Well, obviously in the interests of a fairer system there would need to be grandfathering and exemptions for a while.

Stamp duty's only paid on new purchases, so it wouldn't be that hard to remove stamp duty and replace it with a land tax as property is sold.

The government would take a pretty big hit in cash flow initially, but that would then be offset by more reliable and predictable revenues in the future.

 

[hindy111]

If they want to sell their house they will.

I've never gotten too sentimental about a house that I've bought. I'll offer what I think it is worth and what I want to pay and if it isn't good enough I'll move on. If I had to factor in stamp duty then I would adjust my search criteria accordingly.

Sometimes you get lucky though. Like the time I bought a house in Perth for $100K less than what the previous owner paid for it.

Stamp duty is to high. But removing might have implications also.
And well just unfair on me as I am going to purchase soon. f**king hell.

 

[Bandwagon]

So sellers would be prepared to take 30-50k off price incase a tax might be changed in 6-12mths?
That is not going to happen at all.
People have a budget. If it's 850k then that includes the 40k stamp duty. So they look at places for the 800k mark.
It won't happen overnight but over 3 or 4 yrs that 40k will be tacked onto house price as people budget is higher. It will just fuel house prices imo and limit renoes and extensions.

People who would weigh up spending 80 -150k on a renoe will more likely just sell their property and buy something already done or bigger and better. It just wouldn't be worth the cost of renovating.

Anyhows that is my take on it. If your in the renovating/extension game I reckon you will end up down on work.

If you are removing one tax, and replacing it with another ( equal ) tax, it doesn't affect affordability, but in this case it might enable more buyers to enter the market earlier, which is what might push up prices, though with various schemes to first home buyers with stamp duty exemptions, which would obviously go, that might not be all that much.

Using your example people would still need to budget for an ongoing land tax, so whilst they don't need to pay that 40k of stamp duty upfront, they will need to pay the tax replacing it, and that's gonna mean they can't service as high a loan, all things being equal, that could pretty much even out. ..

 

[hindy111]

If you are removing one tax, and replacing it with another ( equal ) tax, it doesn't affect affordability, but in this case it might enable more buyers to enter the market earlier, which is what might push up prices, though with various schemes to first home buyers with stamp duty exemptions, which would obviously go, that might not be all that much.

Using your example people would still need to budget for an ongoing land tax, so whilst they don't need to pay that 40k of stamp duty upfront, they will need to pay the tax replacing it, and that's gonna mean they can't service as high a loan, all things being equal, that could pretty much even out. ..

This is true. Long term I reckon people are worse off.
I have seen how Auctions go in Sydney.
People who are desperate will push to the max of their budget. And sometimes even over. And stamp duty for first time buyers only applies to properties under 700k. So perhaps it wont effect those places as much. But what percentage of houses in Sydney are under this? And would it then attract more investors for them to compete with if no stamp duty is required.

 

[Bandwagon]

This is true. Long term I reckon people are worse off.
I have seen how Auctions go in Sydney.
People who are desperate will push to the max of their budget. And sometimes even over. And stamp duty for first time buyers only applies to properties under 700k. So perhaps it wont effect those places as much. But what percentage of houses in Sydney are under this? And would it then attract more investors for them to compete with if no stamp duty is required.

Again for investors you're still replacing one tax with another, so whilst the capital investment is lower, so is the yield in raw dollars. It doesn't make a hell of a lot of difference if your mortgage repayment goes down by say $50.00 a week due to having to borrow less, but your expenses go up by $50.00 a week because you have to pay an ongoing tax.

 

[Gronk]

Again for investors you're still replacing one tax with another, so whilst the capital investment is lower, so is the yield in raw dollars. It doesn't make a hell of a lot of difference if your mortgage repayment goes down by say $50.00 a week due to having to borrow less, but your expenses go up by $50.00 a week because you have to pay an ongoing tax.

IIRC in Qld you pay a loaded rate of stamp for properties other than your principal place of residence. You apply for a concession rate make make certain undertakings.

Unsure how this impacts rents long term as the up front costs are obviously higher. They also have land tax, however land values are considerably lower in QLD than NSW.

 

[Bandwagon]

IIRC in Qld you pay a loaded rate of stamp for properties other than your principal place of residence. You apply for a concession rate make make certain undertakings.

Unsure how this impacts rents long term as the up front costs are obviously higher. They also have land tax, however land values are considerably lower in QLD than NSW.

I would imagine higher capital costs to investors wouldn't have too much effect on rents as they still operate within a market. You can't just simply charge more than the market will bear. If anything if it is cheaper for the owner occupier to purchase than it is for the investor, then one would expect that would lead to investors placing less pressure on markets through demand and lead to lower prices than would otherwise be the case.

It's also worth noting that stamp duty is a capital cost, increasing your base cost for CGT purposes, so is deductible against capital gains ( where housing investors actually make their returns ) So it's still all a bit swings and roundabouts.

 

[Gronk]

If the Libs can get Andrew Constance and Mike Baird into federal seats, they are on two winners for sure.

 

[Gronk]

There are a few rumblings this morning about the NSW Gov kick starting the economy by "abolishing" stamp duty. Read the fine print and be careful with what you wish for.

Remember when you used to buy software for $150 up front ? Now they (microsoft, adobe etc) charge you for a "small" annual fee ? Annual recurring revenue streams are a smart business model.

Once they have everyone paying land tax, their revenues will no longer fluctuate with property market ebbs and flows.

https://www.skynews.com.au/details/_6153761649001

Stamp duty reform on the horizon

03/05/2020|2min

The NSW and Victorian Treasurers are working on proposals to scrap stamp duty for good, Sky News Political Andrew Clennell says. Mr Clennell said the proposal coincides with Scott Morrison and Josh Frydenberg’s push for reform in a post-COVID economy.

"In NSW, David Thodey, who is also on Scott Morrison’s COVID Commission, is preparing a review of federal-state relations to be finished next month which is expected to recommend scrapping stamp duty for a flat annual land tax,” he said. "Anyone who has already paid stamp duty would not have to pay the land tax.

"People buying property would be given the choice of paying the land tax or stamp duty and the reforms would be phased in.” It’s understood prior to COVID-19, NSW Treasurer Dominic Perrottet wanted the federal government to foot the bill for a changeover, but due to the recent stimulus spending, he has “given that up”.

 

[strider]

If the Libs can get Andrew Constance and Mike Baird into federal seats, they are on two winners for sure.

Do people like Constance? ... i thought he was considered an arsehole until his house was threatened by a bushfire?

 

[Bandwagon]

Do people like Constance? ... i thought he was considered an arsehole until his house was threatened by a bushfire?

I think he won a lot of friends through that

Watching his performances though I had serious doubts about his mental health.

The guy looked genuinely crushed.

 

[Gronk]

Merkins will see the content of this podcast through their own lense, however I found it refreshingly honest and quite funny.

Malcolm Turnbull interviewed by the lads at Beetoota Advocate.

https://podcasts.google.com/?feed=a...xOGI5ZGYtZjVmMC00YTA3LTkwM2QtNDllNDdmNjg1OWZl

 

[Gronk]

I have no idea that this guy is talking about. Please help me @Hollywood Jesus, you're my only hope !

 

[Gary Gutful]

Obamagate. Do I have to draw you a diagram!

 

[Bazal]

FFS it's so simple. It's right there! Anyone can see it.

 

[T.S Quint]

I can’t see it.

 

[Hollywood Jesus]

He's talking about #ObamaGate.

If you don't know what it is then just relax. You'll find out soon enough.

 

[strider]

But he said we already know what it is

 

[Gronk]

 

[Gronk]