The Queensland Government is treating the property sector like an ATM once again, says the REIQ, with their announcement today that property transaction from foreign buyers will attract an additional three per cent surcharge.
REIQ CEO Antonia Mercorella said the Labor Government’s decision was disappointing. “Curtis Pitt made a firm commitment to Queenslanders and the property industry in 2015 that he would not raise stamp duty or increase costs or fees for foreign buyers.
“He said, ‘Queensland is open for business’ – but today he’s slammed the door shut,” Ms Mercorella said. “The State Government has failed to consult with industry groups on this matter and if they had, we would have told them how fragile the market is at the moment,” Ms Mercorella said.
“This could not come at a worse time – regional Queensland is struggling and we have rising vacancy rates along with falling job rates.
“Regional Queensland – where two-thirds of us live – needs all the investment help it can find and by adding another tax on the top of what they already rake in, the State Government is further threatening the viability of the property market.
This 3% additional surcharge on stamp duty is a significant impost for the non-concessional buyer. On a property sold for $600,000, where stamp duty amounts to a little over $20,000, an additional 3% would be an additional $18,000.
“That’s not a small amount – it almost doubles the stamp duty,” Ms Mercorella said.
“This is potentially disastrous news for our apartment market where some estimates have foreign buyers at around 15% to 20% across Brisbane in the new apartment market.
“The Gold Coast apartment market also relies on foreign investment levels and this could be a significantly negative impact on that market.
“Mr Pitt’s additional surcharge on those buyers will significantly impact that market, at a time when we can’t afford to lose buyers,” she said.
Until the Government specified exactly what constitutes a foreign buyer, it remained unclear who could be caught in the definition.
“It’s not necessarily someone living overseas. It could be a foreign national who’s been living here for many years,” she said.
Ms Mercorella said this measure also added a new layer of red tape that the industry did not need.
In his press club address Mr Pitt also announced a $5000 increase to the first-home buyer’s grant, however, it would remain accessibly only for new builds.
“We welcome the increase in the first home buyers’ grant from $15,000 to $20,000 but it needs to be broadened to existing establishments.
“Regional Queensland does not need stimulus for new dwelling construction – it has an oversupply of housing.
“This is a poorly thought-out policy flip that reflects a deep lack of understanding of what is happening outside of the southeast corner,” Ms Mercorella said.
“I thought this Government would fight harder for regional Queensland.”