What you need to know about NSW’s property taxes & transfer duty

If you’re looking to buy into the New South Wales property market, it’s important to consider the costs beyond the price of your dream home. Other financial implications, such as land tax and transfer duty, should be included in your budget early in your property buying process, to avoid any unexpected costs causing issues once you’ve decided on a home or investment property. In this blog, we’ll examine the key components of property taxes and transfer duty in NSW.

New South Wales property taxes

  • Land Tax:
    In NSW, land tax is an annual tax determined by the value of land you own, as of the 31st of December each year. This tax is subject to exemptions and certain thresholds, but it is recommended to investigate whether you will be liable for land tax for your new property. 
  • Foreign Investor Surcharge:
    If you’re based overseas and looking to purchase property, as an investment or a home, you will be subject to an additional fee on top of both transfer duty and land tax. This surcharge was created to discourage foreign investors from buying NSW property, in a bid to address the housing crisis. 
  • Transfer duty:
    Transfer duty, sometimes referred to as stamp duty, is a one-time fee for the transfer of ownership on a property.

What is transfer duty?

Transfer duty is a government enforced tax on the transfer of property. It is a significant cost that buyers need to consider when purchasing real estate. The amount of transfer duty depends on the property’s value and various other factors.

How much does transfer duty cost in NSW?

Transfer duty in NSW is a sliding fee, meaning that it is determined by the value of the property you are purchasing. The NSW government has provided an online transfer duty calculator so that prospective buyers can get an idea of how much transfer duty they will be liable for. If you’re a first-time homebuyer, you might be eligible for a concession on your transfer duty. It is best to speak with a professional for advice on transfer duty, so that you can make decisions on your property purchase with confidence. Purchasing property in NSW can come with unexpected costs if you’re unaware of the state’s land tax and transfer duty. Preparing your budget for these additional costs can save stress in your property purchasing journey. If you would like to speak to experts about purchasing property in NSW, you can contact our friendly team on 1300 1BORRO.

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