The NSW government will limit full stamp duty concessions to those buying new homes from January 1, 2012. First-home buyers will no longer have their stamp duty fully subsidised by the state government unless they buy newly constructed homes.
See full article here: http://www.propertyobserver.com.au/residential/nsw-scraps-stamp-duty-concessions-for-existing-homes-from-2012/2011090651441
Note by Tim:
This is a low blow to young first-home buyers who have been saving funds to buy their own property and are now under urgent pressure to purchase before the end of this year in order to benefit from the Stamp Duty exemption. The immediate result will be a mad rush to buy anything they can get their hands on in a price range up to $600,000 where there is already a severe lack of stock on the market. Even in the range up to $500,000 they are competing with "downsizer's", their own siblings and thousands of cashed-up investors taking advantage of high rental returns.
As of 1st January next year they will still get the $7,000 first-home buyers grant if they purchase any property, but the Stamp Duty saving which has been such an attractive incentive to make their first home purchase of up to $17,990 (and which has largely driven property sales over the past two years) will no longer be there to help them. They will all be forced to purchase either brand new homes or 'off-plan' homes in order to be eligible, and this is a major problem on the horizon because there simply aren't enough new homes under construction in NSW to meet the demand.
It's not difficult to predict a boom in sales demand for first-home buyers starting right now until the end of the year. The immediate impact will be a rise in price expectations by vendor's and panic buying at inflated prices.
And what is worse is that beginning early next year we are sure to see a general slump in property sales as young buyers exit the market.