First Home Buyer

Understanding Stamp Duty: Costs and Concessions

Calculate stamp duty costs, understand state variations, and learn how to minimize this significant upfront expense.

5 min
Expert Guide

Stamp duty is one of the largest upfront costs when buying property in Australia, often reaching $20,000-$50,000 depending on location and property value. However, first home buyers and certain property types may qualify for significant concessions or full exemptions. Understanding these rules can save tens of thousands of dollars.

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What is Stamp Duty?

Stamp duty (officially "transfer duty") is a state government tax on property transfers. The amount is calculated on a sliding scale based on property value—higher priced properties pay a higher percentage. Duty is paid at settlement and must come from your savings, not your loan. Each state sets its own rates and concessions.

How Much is Stamp Duty?

For a $600,000 property: NSW $24,000, VIC $31,000, QLD $17,000, SA $21,000, WA $21,000. For $800,000: NSW $32,000, VIC $43,000, QLD $28,000, SA $34,000, WA $32,000. These figures assume no concessions. First home buyers often pay nothing or significantly less.

First Home Buyer Concessions

NSW: No duty on properties under $650,000, concessions to $800,000. VIC: No duty under $600,000, concessions to $750,000. QLD: No duty under $500,000, concessions to $550,000. SA: Concessions for properties under $650,000. WA: No duty under $430,000, concessions to $530,000. These thresholds apply to first home buyers purchasing to live in.

New vs Established Properties

Some states offer better concessions for new builds. NSW provides duty relief to $800,000 for new homes ($650,000 established). Victoria treats new and established equally. QLD focuses concessions on new builds under $500,000. When comparing properties, factor stamp duty differences—a $650,000 new build might cost $10,000-$20,000 less in duty than a $650,000 established home.

Investment Properties and Duty

Investment purchases don't qualify for first home buyer concessions—you pay full duty. Additionally, some states charge foreign buyer surcharges (8-10% extra). If you're not a permanent resident or citizen, check your state's foreign buyer duty rules. Factor these costs into your investment ROI calculations.

Vacant Land and Off-the-Plan

Buying land to build on may attract lower duty (calculated on land value, not finished property value). Off-the-plan purchases use the contract price for duty calculations. If property values rise between contract and settlement, you don't pay extra duty. Conversely, if values fall, you can't claim a refund.

Key Takeaways

Stamp duty significantly impacts how much deposit you need. First home buyers should verify their state's concessions before budgeting. The difference between paying $0 and $30,000 in duty affects your property search budget and deposit requirements. Use your state revenue office's stamp duty calculator and discuss with a mortgage broker to understand your obligations and savings opportunities.

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