Burgess Thomson helping first home buyers unlock property dream | Newcastle Herald

Burgess Thomson are located in brand new offices at 1 Newcomen Street, Newcastle. For more information call (02) 4929 5602 or visit www.burgessthomson.com.au. Picture supplied.

Under the NSW government’s new First Home Buyer Choice legislation thousands of first home buyers can now unlock the dream of home ownership sooner.

Recently passed through Parliament, the scheme offers first home buyers purchasing properties up to $1.5 million a choice between paying transfer duty up front or an annual property tax.

The government estimates removing the obligation of paying costs like transfer duty could shave up to two years off the time required to save to buy a property.

But which option you choose will depend on a number of important considerations, according to James Thomson, Director and Principal Lawyer at Burgess Thomson.

“Whether you opt for the annual property tax over transfer duty will depend on factors like the price of your property, whether you qualify for existing first home buyer concessions and what your future plans might be,” James said. “The property tax option will be available for properties up to $1.5 million, and will only be payable by first home buyers who choose it, and will not apply to subsequent purchases of a property.

“Existing transfer duty concessions for first home buyers are available for purchases of up to $800,000, and these concessions will continue. Purchases up to $650,000 remain exempt from transfer duty.

“Burgess Thomson Lawyers have the expertise and experience to help first home buyers make the choice that best suits their individual situation with accurate, easy to understand advice that could potentially save them tens of thousands of dollars and have them owning their first home sooner.”

Example 1

Sarah and Nicholas are buying their first home, a $650,000 house in Shortland, with a land value of $340,000.

Ordinarily, transfer duty on a $650,000 home would be $24,340, but because Sarah and Nicholas are first home buyers, they are exempt from transfer duty and therefore do not choose the property tax.

Example 2

Maria is buying her first home, a $750,000 apartment in Wickham. The apartment has a land value of $270,000.

As an eligible first home buyer, Maria qualifies for a concessional rate of transfer duty which in this case results in transfer duty of $20,727. In 2022-23, the annual property tax on the apartment would be $1,210. Maria aims to upgrade to a larger home in about five years, and thinks she will end up paying less tax under the property tax option. So she chooses the property tax.

Example 3

Arun is buying his first home, a $1.2 million townhouse in Cooks Hill, with land value of $720,000. Transfer duty on this purchase is $50,200, and the purchase price is above the threshold for any first home buyer transfer duty concessions. In 2022-23, property tax on the property would be $2560.

Arun is not sure how long he will own the property, but he has heard that half of all owner-occupiers sell their property within about ten years. Not having to pay transfer duty would help to lower the up-front costs of the purchase, so Arun chooses the property tax.

Burgess Thomson

Burgess Thomson is one of Newcastle’s most highly regarded practices, established since 1983 and listed in the Legal 500 and Doyle’s Guide of top ranked law firms.

Burgess Thomson’s areas of expertise include:

  • Conveyance, Property Law and Leases
  • Wills, Estate Planning, Deceased Estates and Will Disputes
  • Business and Commercial Law and Superannuation

Founder Damian Burgess has over 40 years’ experience in the law and many loyal clients.

James has over 20 years’ experience and holds a Master of Laws degree from University of Sydney, law and commerce degrees from University of NSW, and has also completed the Program on Negotiation at Harvard Law School.

Together with a team of Lawyers and Paralegals, they take the time to get to know their clients and service their needs.

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