If you already thought that Sydney’s housing affordability was outrageous enough, many forget about the infamous stamp duty tax. Domain Australia recorded Sydney’s median house price jumping to a staggering record high of $1.1 Million in December 2016 which in turn, requires a compulsory stamp duty fee of over $46,000. The #stampoffduty campaign aims at identifying Government change regarding stamp duty, especially for first home buyers and foreign investors. Is the Government really out of touch with housing affordability and the efficiency of allocating stamp duty?
The #stampoffduty campaign was developed off the comedy channel’s television show ‘Open Slather’. A Sydney home auction parody, poking fun at housing affordability and the lengths purchases are willing to go to get a foot in the door (literally). Although this skit is humorous and light-hearted, the struggle is no joke and a serious reality for many young Australians. The campaign engages many of the ‘stereotypical’ purchasers from fist home buyers, middle aged superfund ‘dippers’, baby boomers to corporate women, foreign investors and ‘cashed up bogans working overtime’. These hyperbolic examples of individuals within the excessive Sydney market are laughable, yet sadly you resonate with one of these in-groups. Alongside the auction skit, textbox’s identifying the requisites behind stamp duty and what you need to know before considering entering the housing market, such as, first home buyer incentives, foreign investment tax capping and exceptions to payment of stamp duty, further breaking up the clip to allow additional contemplation on this popular social issue. The campaign #stampoffduty was promoted through Facebook in the likes of quizzes and sharing newspaper articles. It was also shared amongst various online social networks such as YouTube and Instagram, creating a larger stomping ground for the promotion of our social issue.
KPMG’s chief economist, Brendan Rynne slams mandatory Government stamp duty as a brutal and desperate ‘cash grab’, calling for Government parties to ‘show some political courage and scrap or reduce the antiquated tax’, ultimately supporting the #stampoffduty campaign by acknowledging that soaring stamp duty charges cripple future home owners to reach the ‘Australian dream’ of owning your own home. Rynne’s statement is closely associated with the #stampoffduty closing recommendations of reviewing the scale of stamp duty, reinvesting back into first home buyers (e.g. bring back the first home buyers grant) or increasing the tax on foreign investors. In the 2016 Government budget, a 4% stamp duty surcharge was introduced for foreigners purchasing properties. However, Deputy Director of the Australia-China Relations Institute at the University of Technology, Professor James Laurenceson questions the legitimacy of these increases by stating ‘the housing prices particularly in Sydney continue to rise, even if the proportion of foreign investors falls, it doesn’t mean that house prices will fall too.’’ Laurenceson further explains that 96.4% of buyers were local, further assuring overseas investors will not contribute to housing affordability.
It is with the #stampoffduty campaign we are opening the eyes of current and future home owners to question where their hard earnt money is going and why. With the current release of the 2017 Federal budget, first home buyers are yet again let down. Introducing a ‘first home super saver scheme’ which would allow up to $30,000 in a form of salary sacrifice, in order to boost start savings for a home deposit will essentially be no help. In Sydney’s most expensive market, a 10% deposit on even half of the median house price would be $57K. Add stamp duty and other costs and suddenly sellers benefit and buyers get no joy. It is with hope that the Government realises the great inconvenience stamp duty places on any potential home owner, now or in the near future.
If you would like to visit the #stampoffdutycapaign, please click here.