REFORM of crippling stamp duty and creation of an economic climate conducive to improving housing supply top the wish-list for the property industry in the lead-up to Victoria's state budget tomorrow.
Leading property groups, such as the Master Builders Association of Victoria, the Real Estate Institute Victoria and the Housing Industry Association have included these policy ideas, and a host of others, in their submission to the State Government.
The building and construction sector is a large contributor to the Victorian economy, with its share of state output measured at about 12% of the state's gross domestic product.
It is estimated that the sector employs about 170,000 people directly and generates output of more than $27 billion.
A common theme is growing concern over stamp duty paid by new home buyers.
REIV chief executive Enzo Raimondo called on Treasurer John Lenders to initiate stamp duty reform.
He said the Government should introduce indexation to stamp duty rates to ensure that Victorian home buyers were not forced to pay proportionally more as home prices increased. "Current stamp duty rates mean that the State Government charges proportionally more in stamp duty the higher the sale price, meaning that many buyers face the prospect of bracket creep as prices increase," Mr Raimondo said.
The MBAV noted the near constant growth of property tax (especially stamp duty on conveyancing), as well as poor follow-through on Melbourne 2030, expensive sustainability regulations and continued uncertainty in planning decisions were all undermining housing affordability.
Executive director Brian Welch said that along with development charges, land tax and payroll tax, stamp duty dampened the investment climate.
The HIA wants a whole-of-government approach to ensure higher-density residential development is economically feasible.
Eli Greenblat | May 5, 2008 | The Age
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