Fees, stamp duty up to $100k ’absurd’, warns John McGrath
A property turnaround could trip over growing transaction costs in big cities, with buyers paying as much as $100k in fees and stamp duty alone, a new report warns.
This according to the McGrath Report 2020, released this week, with MD John McGrath warning higher transaction costs and economic uncertainty were seeing record low listings in most city markets.
"Upgraders in big cities are paying close to $100,000 in fees and absurdly high stamp duty," he said.
"If we went back just 20 years for direct comparison, we are now paying an additional $40,000 (inflation adjusted) or 400 per cent more in real terms."
"This is ridiculous and penalises almost every single Australian moving around the property ladder as their life circumstances change."
Mr McGrath said with the exception of the ACT Government - which plans to phase out stamp duty by 2032 - there seemed to be very little appetite by State Governments to find a better way.
"They seem addicted to the revenue it brings them. As a result, it's possible that these lower levels of activity will remain for some time."
He said uncertainty in the world economy was impacting confidence with many "waiting to see how some of these play out".
Mr McGrath said tighter supply in a market where there was strong demand off cheaper money via borrowing and lower interest rates would drive up prices.
It was "likely to be a positive factor in the price rebound we're now experiencing", he said.
"Less for sale generally means better prices. This may indeed keep us in solid territory until we see the next sales cycle begin," he said of price growth in the market.
Originally published as Fees, stamp duty up to $100k 'absurd', warns John McGrath