If you are planning on selling a property in 2019, and that property is likely to have appeal to first home buyers, then there is one number that you need to be aware of…the number 6. Why 6? Well, in Victoria, qualified first-home buyers pay no stamp duty when purchasing a property up to the price limit of $600,000, then pay reduced amount stamp duty on prices up to $750,000.
As a result, in many parts of Victoria, first home buyers are sticking to a price limit of $600,000 and, according to agents in those areas, are missing out on some good opportunities in order to avoid paying stamp duty.
Indeed, we have heard of some agents advising some vendors not to undertake renovations prior to putting their property on the market as these improvements would push the value of the property above the $600,000 limit, making it more difficult to sell.
Whilst this price barrier is not apparent in every area, the feedback we are receiving from a number of agents is that it is certainly affecting the market in those areas where firstr home buyers are particularly active, ranging from free-standing homes in the outer suburbs to apartments closer to the CBD.
Whilst the uncertainty we have seen in the Melbourne market over the past year has impacted on all sections of the market, it is worth noting that the first home buyer market has remained relatively strong, with sources indicating that activity levels still around 20% higher than they were in this segment in 2015-2016, particularly with the drop in investment purchases following the tightening of lending requirements by APRA.
Of course, if you are planning a sale and you feel your property could be of interest to first home buyers, setting the right price point is just one of the factors that could impact your sale, so be sure to discuss this with your Vendors Advocate. You’ll also find more tips on how to maximise your result in our free booklet, “Fatal Real Estate Traps Exposed”.
Don’t forget, if you need any assistance or advice when preparing your property for sale, you can call our Customer Service team at any time on 1300 400 400.