Hordes of first homebuyers to hit property market as July 1 stamp duty changes take hold - Holmes

THRONGS of eager first-timers will enthusiastically hit the property market from today (July 1) as stamp duty exemptions for first homebuyers spending less than $650,000 take effect.The savings — stamp duty scrapped for first-timers buying property for less than $650,000 and discounts for those paying less than $800,000, plus the abolition of insurance duty on lender’s mortgage insurance — could see a flood of young buyers attending auctions and open houses this weekend.

First homebuyers Melissa Atlagic and Matthew Sganga. Picture: Jonathan Ng

Melissa and Matthew plan to buy their first home now the stamp duty changes have kicked in.

Melissa Atlagic and her fiance Matthew Sganga will be joining them.

Childcare worker Ms Atlagic, 27, and her tyre fitter partner, 28, have been saving a deposit for a year and a half.

“I can’t wait — I want to move in already!” she said.

Despite the excitement, the couple — set to wed next July — are taking care not to rush into anything.

“You have to make the right decision, I don’t think you should jump into something straight away,” Ms Atlagic said.

Aerial Pics for Housing Splash

The area around the site of the Badgerys Creek airport is popular with first homebuyers. Picture: Jonathan Ng

The pair, currently living in Wetherill Park, are focusing primarily on house and land packages in the Badgerys Creek/ Leppington area, where they’ve visited a couple of display homes already.

First-timers buying a $500,000 new property could save as much as $28,000.

“That $20,000 or $30,000 makes a huge difference to us,” Miss Atlagic said.

“It’s a really good incentive.”

Industry insiders are warning that first homebuyer numbers will now start to rise, in contrast to the recent slowdown.

Belle Property Lane Cove agent Debbie Jepson said the weeks leading up to the changes have seen many buyers “in hiding”.

“They’re holding back, seeing what the market will do.”

Mortgage Choice Parramatta manager Aurelio Tenaglia believes people will be rushing to the market.

“We started to field inquiries for ‘how much can I borrow?’ and for loan pre-approvals within days of the announcement.”

Launch of Dee Why Tower

First-time buyer numbers at open homes are expected to rise this weekend. Picture: Troy Snook

Ms Atlagic and Mr Sganga are only too aware that the changes could make things slightly tougher in the market.

“It will be a bit more competitive in regards to finding a place, but I think for the first homebuyers it’ll be better.”

Speculation that it will go berserk has been dismissed by some experts.

Starr Partners CEO Douglas Driscoll said we might see the number of first homebuyers rise from current low levels (four or five per cent) to double digits, but that’s where you’d expect numbers to be in a healthy market anyway.

Go West McMansion

Starr Partners CEO Douglas Driscoll. Picture: Jonathan Ng

“We must maintain some perspective.

“Will we see a massive wave of buyers? No. Will we see uplift? Yes.”

Finder.com money expert Bessie Hassan said the stamp duty savings will make a real difference to many.

“A saving of $26,000 is significant when considering the full range of costs related to buying property, and this surplus could go towards other costs such as loan repayments, repairs and maintenance, council taxes, or legal costs.

“We may see a spike in the number of approved first homebuyer loans in New South Wales.

“It must be said, however, that first-time buyers in some cities may miss out on these savings. The median house price in Sydney is somewhere between $900,000 and $1 million … well above the $800,000 threshold for a discount.”

Buyers’ agent Rich Harvey is expecting a “marching on the street of first homebuyers”, but he also describes the moves as an “artificial incentive”.