In summary:
Your first home is always a challenge. But getting a head start can open many doors.

Before reading, please note due to the numbers of suburb in Victoria this article provide concentrated on a section of the Melbourne’s Metropolitan area being the City of Brimbank and nearby area.

At the time of this article is written (2022); the median (average) price of the suburb of Sunshine VIC 3020 is $880,000!

In 2015 it was $520,000, only 7 years has passed since then this date, a difference of $360,000!

Moving a bit further away from Sunshine area in the Western Suburbs, approximately 20 minutes drive, you have Tarneit VIC 3029, median approximately $600,000, and in 2015 approximately $400,000.

And even moving further away, another 20 minutes drive, you have Melton VIC 3337, median approximately $455,000 and 2015 was $255,000.

Getting your first home can be challenging, the price of a house trend is moving up. There is no further needs to think too much when you may hear, “Get your foot in the doors”. That why we are here to protect you from losing your hard earn money. Do not sign any contract without talking to us before hand.

Reference:
https://www.land.vic.gov.au/valuations/resources-and-reports/property-sales-statistics
https://www.realestate.com.au/

In summary: (As Purchaser) Ask for the Vendor to pay for all their Landtax.
(As Vendor) Consider if the Landtax should be apply to the Purchaser or not.

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You recently bought a property and you see your “Statement of Adjustment”, you see Council Rate, Water Rate then there is this “Landtax” section.

Your conveyancer explain to you that you have to pay for this Landtax, the next question you may ask is, “What is a Landtax?”. The response may be it is property that is an investment, you reply, “I’m buying this to live in, why do I have to pay for the Landtax?”

It is very common for property to have a Landtax on a property, and depending on the property value and the settlement date, that could be another $500 to $1,000 expense you may be ready for.

Worse still, the Contract of Sale may state that the Landtax is proportional, what this mean is, if the Vendor (Seller) have many land, house & asset, the are paying Landtax at a higher value then a Vendor with one 1 investment property. The expense of $500 to $1,000 is no longer applicable and a bill of $2,000 to $5,000 is asked for you to pay at settlement which meant to be a happy day for you.

How can you prevent for this? As always it come down to negotiation and understanding of the Contract of Sale. If you negotiation that all Landtax is payable by the Vendor as you are planning to live in the property for example or the Vendor owes too much asset and it is not your responsible to help the Vendor with their tax problem.

As a Vendor, you would like to offset this cost of selling your property, it is understandable as it is an outgoing and expense in maintaining your property. Taking into consideration of all the expense you will be liable to and have been paying for, you may have a Sale (Purchase) Price that fit your expectation when it come to selling your property.

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If you like to read more about Landtax, how it is calculated, it history and your obligations, please read further at the State Revenue Office website: https://www.sro.vic.gov.au/land-tax

Buying

In-confidential

Disclaimer: This article does not constitute legal advice and should not be relied upon as such. It is intended only to provide a summary and general overview based on update, change and news within the industry.