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Victoria's first-home stamp duty discount

Victoria’s first home buyer stamp duty concession is generous but structured differently from NSW’s. The headline: properties up to $600,000 pay zero duty for first home buyers. Between $600,001 and $750,000, a sliding concession applies. Above $750,000, full duty applies.

The exact thresholds

  • Up to $600,000: nil stamp duty (full exemption)
  • $600,001 to $750,000: concessional rate, tapering
  • Above $750,000: full rates

On a $600,000 purchase, you save approximately $31,000 in stamp duty. On a $700,000 purchase, the concession saves you about $12,000. Above $750,000, you pay the full duty.

The $750k cliff

Unlike NSW where the concession tapers up to $1m, Victoria’s concession stops hard at $750,000. Going from $750k to $751k triggers a jump from partial concession to full duty - the cost of that extra $1,000 of price is approximately $12,000 in additional duty.

This creates strong buyer clustering just below $750k. Vendors and their agents know this, and $749k properties routinely transact exactly at that mark, because bidding above triggers a disproportionate duty penalty.

New build vs established

The concession applies to both new and established property. This is more generous than NSW’s approach, where the FHOG portion is restricted to new builds.

Off-the-plan concession

Separately from the first home buyer concession, Victoria also offers a duty concession on off-the-plan purchases: stamp duty is calculated on the value at contract date excluding the value of construction yet to be completed. On an off-the-plan apartment where construction accounts for 50% of the purchase price, you only pay duty on the other 50%. This concession is available to first home buyers and non-first-home buyers alike (though first home buyers can layer the two concessions).

Income test

Unlike some jurisdictions, Victoria does not impose a formal income test on the stamp duty concession. The test is the property price cap.

Principal place of residence requirement

You must occupy the property as your principal place of residence for at least 12 months, starting within 12 months of settlement. If you breach this, you pay back the duty concession plus penalty interest. The State Revenue Office audits this - if you list the property on Airbnb within the 12-month period, or your utility bills show minimal usage, expect an audit letter.

Layering for VIC first home buyers

  • Stamp duty concession (this article)
  • First Home Guarantee (5% deposit, no LMI)
  • FHOG ($10k for new builds up to $750k)
  • First Home Super Saver Scheme

In Melbourne where median unit prices are below Sydney, buying an established property at $650k attracts the duty concession ($18k saving) but no FHOG. Buying a new apartment at $650k attracts duty concession + FHOG = $28k benefit. For most metro Melbourne first home buyers, the new-vs-established trade is worth running both scenarios.

Regional Victoria

Regional Victoria has its own additional concessions. In 2022 the VIC government introduced a 50% regional stamp duty concession for any buyer (not just first home buyer) in specific regional postcodes. For first home buyers in regional VIC buying new, the combination of state concessions, regional concessions, FHOG, and FHG creates one of the most favourable settings in Australia.