The Real Estate Institute of Queensland (REIQ) has welcomed Federal Housing Minister Clare O’Neil’s endorsement of phasing out stamp duty, stating the time is right for significant reform.
Minister O’Neil, speaking to ABC RN, voiced the Albanese Government’s support for greenfield development and infill of higher-density suburbs, while backing calls for the gradual removal of stamp duty, referring to it as a “bad tax.”
REIQ CEO Antonia Mercorella highlighted that this public support from the Federal Government opens the door for Queensland’s State Government to collaborate on phasing out the outdated stamp duty system, a move that could increase homeownership across the state.
“Stamp duty presents a considerable barrier to those wanting to buy their first home, and to retirees seeking to downsize their family home,” Ms Mercorella said.
“It also hinders job mobility, which affects the productivity of the entire economy, as well as impacting significant life decisions such as starting a family and moving homes.”
Ms Mercorella emphasised that phasing out stamp duty could drive a trend toward ‘rightsizing,’ encouraging homeowners to move into properties that are more appropriately sized and located, ultimately increasing housing supply.
She called for the Queensland Government to begin discussions with the Federal Government on securing a better GST outcome and incentive funding in exchange for stamp duty reform.
“It is a long-standing policy direction of the REIQ to see a phased transition to a land tax-based model, starting with first-home buyers and the abolishment of stamp duty for downsizers aged over 55 moving to a smaller home,” Ms Mercorella added.
“We appreciate that stamp duty is worth nearly $30bn in Queensland’s State Budget, which is why a phased-out approach is necessary to avoid placing additional pressure on the state’s finances.”
Simon Pressley, Head of Research at Propertyology, also weighed in on the issue, describing stamp duty as “the single biggest blockage of human mobility in Australia.” He criticised policies that only target specific groups, such as first-home buyers and retirees, as inadequate.
“Policy proposers who fluff around the edges by tinkering with adjustments for first home buyers and retirees are naïve fools who fail to understand the depths of the damage,” Mr. Pressley said.
“The reality is that a majority of the properties that these two groups want to buy are either owned by another owner-occupier or are part of the rental pool. But the existing owners are discouraged from ‘trading in’ the property because they too will be slugged $50,000 to $100,000 stamp duty on a replacement property.”
With growing support from industry leaders and the Federal Government, the pressure is now on state governments to rethink stamp duty and explore long-term solutions that could significantly improve homeownership rates, housing supply, and economic productivity.
