Over the next two weeks expect a lot of talk by the Federal Government about the great idea of we over-55’s freeing up our big homes for young families by downsizing. The only challenge is ‘downsizing’ can be very expensive thanks to stamp duty – which is levied by state governments.
A $750,000 ‘downsize’ home will cost $25,000 to $40,000 in stamp duty depending on which state you live in. The Property Council says all up the average cost to move house is around $75,000 – in cash.
There is a cheaper option – when you downsize into a retirement village or a land lease community you don’t pay stamp duty. In both cases you are taking out a lease. In a village you are leasing the house and the land. In a land lease community you own the house but you are leasing the land it sits on.
That’s one big cost you don’t have to worry about.
Discussion1 Comment
The NSW Revenue are trying to charge an impending aged leaseholder stamp duty on the purchase price of the lease.
Please, what are the circumstances under which the NSW government can successfully charge stamp duty on a leasehold contract covering the right to occupation over a long period? The putative leaseholder is over eighty years old.
Thank you
Peter Mayhew