Property developers have welcomed the New South Wales government's move to scrap stamp duty exemptions for existing homes, arguing it will help improve affordability and boost construction

Beginning Jan. 1, 2012, stamp duty concessions to first-time homebuyers will be solely available for the purchase of newly constructed homes and apartments. It also preserves until July 1, 2012, an existing measure that exempts purchasers from stamp duty when buying new stock off-the-plan on properties valued up to $600,000.

The NSW government’s decision to target stamp duty concessions to new housing supply is a smart choice, according to the Property Council of Australia.

“Housing supply remains limp across NSW and gearing incentives to motivate the construction of new stock makes sense,” council Executive Director Glenn Byres said.

He said the NSW government’s decision mirrors the strategic direction of the stamp duty concessions unveiled last year that apply to the off-the-plan purchase of new homes and apartments.

“The off-the-plan exemptions were structured to help projects secure lending finance by increasing pre-commitments, and in doing so bring forward new housing," Byres said. "Our research suggests it increased supply by 3,500 homes and we will continue to argue the case for an elevated threshold from $600,000 and a permanent scheme."