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First Home Buyer Legislation Amendment Bill 2023

Published on: May 2023

Record: HANSARD-1323879322-131329

First Home Buyer Legislation Amendment Bill 2023

Second Reading Debate

Debate resumed from 23 May 2023.

Mr MARK SPEAKMAN (Cronulla) (21:03:44):

The contrast could not be clearer. On this side of the House, the Opposition stands for giving first home buyers a choice; those opposite do not. I speak in opposition to the First Home Buyer Legislation Amendment Bill 2023 insofar as it seeks to abolish the First Home Buyer Choice scheme. In his second reading speech, the Minister for Planning and Public Spaces made mention of the Government's "comprehensive plan to address housing affordability". I ask the Minister, "Where is the plan?" There is no plan. The new Labor Government has presented nothing more than this bill, which is a significant retrograde step when it comes to housing affordability in Sydney and New South Wales.

The bill is another sign that the State will stall—or worse, go backwards—under the new Labor Government. Sydney, and much of New South Wales, is facing serious housing pressure and rental pressure. The solution to this pressure is not to remove a policy that has been taken up by more than 8,300 first home buyers since the First Home Buyer Choice scheme opened on 16 January 2023. That is around 440 first home buyers benefitting every single week. First home buyers have voted with their feet in favour of the Coalition's First Home Buyer Choice scheme.

In his second reading speech, the Minister claimed that the First Home Buyers Choice scheme has been rejected by the people of New South Wales. If it had been rejected, first home buyers would not have embraced it. If it had been rejected, why have two in every three eligible first home buyers taken it up? Of the more than 5,000 properties opted in to the First Home Buyers Choice scheme, 45 per cent have been in Western Sydney. A first home buyer purchasing a median-priced house in Parramatta will avoid an up-front fee of $59,000 under the Liberal-Nationals Coalition scheme. In Rockdale, it is a $63,000 up-front saving on a median-priced house. In Kogarah, it is a $70,000 up-front saving.

Members know that the First Home Buyer Choice scheme can cut up to two years off the time needed to save for a deposit. Removing the scheme will simply make it harder for people to enter the property market. It will force people to move away from their jobs, away from their support networks and away from their home communities. Individuals and families across New South Wales have collectively saved more than $197 million since the scheme opened on 16 January 2023. Under the new Labor Government's so-called solution to housing affordability, thousands and thousands of first home buyers will be denied the basic choice between a small annual tax and a large upfront fee.

I also address the proposed changes to stamp duty exemptions and concessions contained within the bill. It takes simple maths to demonstrate that for many first home buyers purchasing a property between $850,000 and $900,000, the Coalition's First Home Buyer Choice scheme would still be more attractive than paying between $10,000 and $20,000 in up-front stamp duty. For at least the overwhelming majority of first home buyers purchasing a property over $900,000, the scheme offers a better deal. The Opposition believes that merely adjusting the stamp duty thresholds does not begin the real tax reform needed to move away from what is widely agreed to be a bad tax.

The Liberal-Nationals Coalition introduced the First Home Buyer Choice legislation not only because it offers savings to first home buyers, but as a significant first step toward broader reform of what is widely agreed to be a bad tax. Stamp duty was first introduced in 1865. This 158-year-old tax is what Labor is seeking to bring back to thousands of property transactions in New South Wales each year. It is far from a fresh start for New South Wales. When the new Labor Premier became the leader of the Labor Party, he sought to build a name for himself as someone focused on policy, engaged in a battle of ideas—even likened to Paul Keating. That was before the election. Since the election, Labor has abandoned its battle of ideas.

Four of the very first actions of the new Labor Government are a sign of what is to come over the next four years. First, promising to protect Sydney Water and Hunter Water, only to completely forget about WaterNSW, leaving out critical assets like Warragamba Dam. Second, playing verbal gymnastics over privatisation to justify the sell-off of publicly owned land. Third, refusing to confirm funding of Active Kids vouchers. Fourth, now repealing the first-of-its-kind, fair, popular, highly successful First Home Buyer Choice scheme. As I said before, the bill is another clear sign that the new Labor Government is taking the State backwards.

Housing affordability is at a crisis point in Sydney. Compared with average incomes, our city has some of the most unaffordable housing in the English-speaking world. It is against this backdrop that Labor seeks to remove the basic choice between a small annual tax and a large up-front fee. The Opposition cannot and will not support such a significant backward step. If the bill passes in its current form, future generations of first home buyers will be deprived of a choice between stamp duty and land tax. Thousands of first home buyers will be unable to unlock the dream of home ownership sooner. The Opposition will seek to amend the bill. It will seek to delete schedule 2 to the bill and seek to index the new thresholds set out in schedule 1. These amendments would ensure that first home buyers still have the ability to choose. They would ensure the bill provides stamp duty concessions to first home buyers as property prices gradually grow over time. The Opposition seeks to amend the bill because first home buyers in Sydney and across New South Wales deserve choice.

Ms MARYANNE STUART (Heathcote) (21:10:16):

First of all, I draw to the attention of the House the fact that the Leader of the Opposition, who just made a contribution to debate and has left the Chamber, has absolutely no support on his position. That is interesting. I am delighted to contribute to the debate on the First Home Buyer Legislation Amendment Bill 2023. The purpose of the bill is simple. The objects of the bill are:

Duties Act 1997

(a)to amend the —

(i)to require a person to reside in a home as the person’s principal place of residence for a continuous period of at least 12 months to be eligible for a duty exemption or concession, and

(ii)to revise values for property to be eligible for the purposes of the First Home Buyers Assistance Scheme, and

Property Tax (First Home Buyer Choice) Act 2022

(b)to amend the to prevent a person making an election to pay property tax rather than stamp duty on a transfer of land occurring on or after 1 July 2023, and

First Home Owner Grant and Shared Equity Act 2000

(c)to amend the to require first home buyers to reside in the home as their principal place of residence for a continuous period of at least 12 months to be eligible for a First Home Owner Grant.

The great Australian dream of owning your own home has never been so unattainable for many. That is a fact that cannot be disputed. Rents have risen sharply, as have house prices and, more recently, interest rates. All of those factors have made it increasingly harder for first home buyers to enter the property market. They are disappointed and disillusioned at their prospects of ever owning their own home. I can understand why they feel that way. I was alarmed when I looked at the figures regarding households in mortgage or rental stress within the Heathcote electorate. A household is considered to be in mortgage stress when it spends 30 per cent or more of its income on rental or mortgage payments. Make no mistake: Figures available through the Australian Bureau of Statistics paint an extremely grim picture for suburbs in my electorate.

Let us take Engadine as an example. In 2016, 4.9 per cent of households were in mortgage stress; in 2021 that number had almost tripled to 14.1 per cent. I shudder to think what that number is today. Sutherland residents also saw their household budgets stretched even further, with those in mortgage stress climbing from 7.5 per cent to 15.9 per cent in the same period. It is important to note that was before interest rates began to climb, which means it is likely that more households are in mortgage stress now. Spare a thought for those renting. The bad news keeps on coming. In 2016, 4.6 per cent of households in Engadine were in rental stress; five years later, that number had risen to 38.7 per cent. I repeat: That is 4.6 per cent to 38.7 per cent in the space of just five years. Helensburgh renters also experienced a tough five years, with the number of households in rental stress rising from 4.8 per cent to 35.6 per cent. Bulli, Thirroul and Sutherland also rose from 8.5 per cent, 6.2 per cent and 16.4 per cent to 35.1 per cent, 30 per cent and 32.5 per cent respectively.

What exactly do the numbers mean and how do they impact the everyday lives of those households? Let us take a prospective first home buyer, for example. If they are contributing more than 30 per cent of their income towards paying the rent, it means that there is not a lot left over at the end of the day to save for a home deposit. It means the divide between the haves and have nots in terms of property ownership has only widened. However, there is light at the end of the tunnel for first home buyers in the form of a new stamp duty scheme being proposed by the New South Wales Government. How would it work? Those first home buyers purchasing a home between $700,000 and $800,000 would not be required to pay stamp duty. It equates to a saving of up to $31,090. Those purchasing a property for $850,000 would save more than $23,000, with the savings continuing for those purchasing properties valued at up to $1 million.

In simple terms, the New South Wales Government is proposing to increase the exemption threshold from $650,000 to $800,000 and the concession threshold from $800,000 to $1 million. Those savings would make an incredible difference to the lives of many people who desperately want to get a foot in the property market. The difference between the policies of the members on this side of the House compared to the policies of those on the other side is stark. Those on the other side wanted to introduce a land tax; we on the progressive and sensible side of the Chamber are focused on putting more money back in the pockets of New South Wales residents. The Minns Labor Government's first home buyer changes would see up to five out of every six home buyers receive a boost. I will say that again: Under the Minns Labor Government's stamp duty changes, five out of six first home buyers would be better off.

As I touched on earlier, the bill also aims to amend the Property Tax (First Home Buyer Choice) Act 2022 to prevent a person making an election to pay property tax rather than stamp duty on a transfer of land occurring on or after 1 July 2023. Members opposite will tell you that their proposed tax on first home buyers was a good thing and that it would have provided home buyers with a choice. It was a choice, all right. You could pay hefty stamp duty as usual or pay an ongoing tax year after year. It was nothing but another way for the former Government to prey on vulnerable households doing it tough. It was another excuse for the former Government to pillage the pockets of hardworking residents throughout the State, including in my electorate of Heathcote.

It was another example of a policy from a former government that forged a reputation for profiting from the vulnerable while lining the pockets of the ultra-wealthy. The land tax was one of many failed policies and decisions that led to the former Government now calling that side of the Chamber home for at least the next four years. I say "at least" because, if the sentiment in my electorate is anything to go by, those opposite will be stuck on that side for many more years to come. I have lost count of the number of local families I have spoken to that are doing it tough at the moment.

TEMPORARY SPEAKER (Mr Clayton Barr):

The member for North Shore will come to order.

Ms MARYANNE STUART:

I know from my own family that young people are struggling with rents. Wanting to be closer to work and independent, they feel they will never be able to get ahead or have housing security for the future. Whether they live in Bulli in the southern end of my electorate or in Kirrawee in the northern end of my electorate, their concerns are the same. Rising power bills, rising grocery bills and rising fuel prices have placed an incredible strain on many household budgets. Increased rents and mortgage repayments have only added to the stress being placed on the bottom lines of households. That is why the amendments in the bill make sense. The amendments in the bill will provide much-needed and welcome relief, particularly for those from younger generations who are desperate to enter the property market.

The amendments in the bill will actually help first home buyers achieve the great Australian dream of owning their own home. The bill will not tax the hip pockets of first home buyers. I am extremely proud to serve in a New South Wales Labor government that values all people. This New South Wales Government does not discriminate by electorate. It is a government for everyone. That is something the former New South Wales Liberal‑Nationals Government cannot claim. One need only look at the bushfire grants saga or the Stronger Communities Fund debacle to see clearly how those on the opposite side of the House—those in opposition—put politics before people. They were more interested in rescuing their fledgling political careers than serving their communities. They were reckless, mismanaged the budget and had no fiscal restraint when it came to trying to save themselves.

Ms Felicity Wilson:

Point of order: I raise the matter of relevance. The member is currently talking about Black Summer bushfires, not the first home buyer scheme. I ask that the member be returned to the bill that is before the House.

TEMPORARY SPEAKER (Mr Clayton Barr):

I have listened carefully. The member for Heathcote has the call.

Ms Felicity Wilson:

Is your ruling that she is being relevant or not being relevant?

TEMPORARY SPEAKER (Mr Clayton Barr):

She is being perfectly relevant. I will listen further.

Ms Felicity Wilson:

That is interesting. Maybe you weren't listening.

TEMPORARY SPEAKER (Mr Clayton Barr):

I remind the member for North Shore that she is on two calls to order. The member for Heathcote has the call.

Ms MARYANNE STUART:

They were reckless, mismanaged the budget and had no fiscal restraint when it came to trying to save themselves, and that showed at the polls on 25 March. Residents of our State have long memories. They take notice of their local members and the decisions they make. Importantly, they hold their elected representatives to account. That is something those on the other side, in opposition, seem to have forgotten. To stand in this Chamber and represent our community is an honour and a privilege. It is not a right. We take an oath to serve our communities and we do so by making sure we represent the interests of all residents. It does not make a difference whether they be nine months or 99 years of age That is why I commend these amendments.

Time expired.

The needs of our youngest generations were continually ignored over the past 12 years by the former Government. We on this side of the Chamber listen and act. The Minns Labor Government has done and will continue to do things differently. We will help first home buyers get a foot in the property market through changes like these to stamp duty. The objects of the bill, as I have already outlined, are simple and sensible. I commend the Treasurer for his commitment and great work in this space. The many first home buyers who benefit from the changes will be grateful to the Treasurer for prioritising their needs and their future. I look forward to welcoming more and more first home buyers into the electorate of Heathcote—whether they choose to purchase a property in the northern end of my electorate, in Engadine, or in the middle, in Helensburgh. []

Mr ALEX GREENWICH (Sydney) (21:20):

I make a brief contribution to the debate on the First Home Buyer Legislation Amendment Bill 2023, which will replace the recently started First Home Buyer Choice scheme with greater access to stamp duty exemptions and concessions by lifting existing thresholds. Home ownership in Australia is declining, particularly by young people. Housing prices have ballooned and are now out of reach for those on low or moderate incomes. We know that owning your own home provides stability and security, particularly when life circumstances change, with wider community benefits. That is why I will not oppose the bill and why I did not oppose the previous Government's scheme. I support changes to increase resident requirements from six months to 12 months, which will help ensure that subsidies target genuine first home buyers. The existing requirement—for owners to live in their new home for only six months—makes it attractive to anyone buying with the intention of flipping the property as an investment.

I accept the Government's argument that the vast majority of first home buyers—84 per cent—purchase a property for under $1 million and will be better off under the bill. Those first home buyers will pay either no or low stamp duty, while not incurring an annual land tax. I accept the Government's concern that half of the cost of the current scheme has gone to those purchasing a home for between $1 million and $1.5 million, when those purchasing such a home make up only 13 percent of first home buyers. Some think that both schemes should be in place, but I cannot justify supporting an estimated further $700 million being diverted to first home buyers, away from homelessness. Subsidies must focus on those most in need.

Those looking for their first home for between $1 million and $1.5 million may be concerned about now having to pay stamp duty, but the evidence suggests that first home buyer subsidies do little for housing affordability and can even inflate prices. Indeed, a September 2022 Productivity Commission review found that nearly $3 billion given to first home buyers in subsidies worked against improving affordability, concluding that this money would have been better spent on preventing homelessness. The reality is that most people accessing first home buyer subsidies would be able to buy a home eventually anyway, while those experiencing housing stress or who are at risk of homelessness will never have the option to buy a home and take advantage of these reforms. We must shift the focus on housing affordability to strengthening safety nets for those who will never be able to afford a home, including by increasing access to social and affordable housing and by making the private rental market fair and affordable.

Right now, low-income earners, those who are frail, those who have complex needs in physical health, mental health, or drugs and alcohol, and women escaping domestic and family violence are being left behind. Their future is dire in what can only be described as one of the tightest rental markets in the State's history. If we do not act, homelessness rates will become out of control. Funding needs to be directed towards the shortfall of around 50,000 social housing homes. We need to build 5,000 new social housing properties every year just to deal with the current social housing waiting list. We need to improve the quality of public housing, provide more accessibility options and support older people who are being squeezed out of the private rental market. We need to work in partnership with the community and cooperative housing sectors, while expanding the shared equity program. Much needs to be done, and I look forward to working with all sides of the House to improve housing affordability for those most in need.

Ms JODIE HARRISON (CharlestownMinister for Women, Minister for Seniors, and Minister for the Prevention of Domestic Violence and Sexual Assault) (21:24:24):

— For too many young people in my electorate of Charlestown, across the Hunter region and all across New South Wales, home ownership has become a pipe dream. For far too many right now, the Australian dream is way too far out of reach. Skyrocketing prices, flat wages, interest rate increases and the economic turmoil of the COVID-19 pandemic, the recession and 12 years of a Liberal-National Government aimed at helping its mates at the big end of town have hurt first home buyers. Either they have delayed purchasing a home, putting off other big life events as a result, or they have given up on ever stepping foot on the ladder of property ownership. This has economic consequences not just for individuals but also the broader community. It means more people living in insecure housing for longer; it means more economic insecurity and more stress.

I will talk about property prices for a moment. In the suburb of Charlestown in my electorate, the median price for a house is $900,000; five years ago, in May of 2018, the median price for a property in Charlestown was $600,000. It is a similar story in other suburbs in my electorate over five years. Kotara has seen median house prices rise by more than $300,000. Prices in Warners Bay have gone from $625,000 to $910,000. Cardiff has seen the median price rise to $707,500 from $490,000. In Eleebana the median price has climbed by half a million dollars, from $770,000 to $1.23 million. These increases, which have come across the board, have been absolutely demoralising to potential first home buyers in my electorate. I have heard directly from constituents in acute housing stress, so far away from owning their own home that it no longer factors into their short-, medium- or long-term thinking at all.

One New Lambton resident who has rented a two-bedroom apartment in the area, where the median price of a home has risen from $700,000 to just over $1 million, said to me, "It's pretty much a non- starter for me. I am a really good saver. I don't really spend money. But, with house prices the way they are, I just can't see ever really owning my own home. Even renting is getting unaffordable in this area." It is not surprising that young people are giving up on the dream. Rents are spiking. We are all familiar with the impact of the cost of living on so many household budgets. Just making ends meet can be difficult, let alone saving for a house deposit. That is why this bill is so important. The First Home Buyer Legislation Amendment Bill will help alleviate these pressures for five out of six first home buyers. It will help more people, more singles, couples and families, take their first steps onto the property ladder.

The bill will amend the Duties Act 1997 to make the First Home Buyer Assistance scheme more accessible, raising the threshold for stamp duty exemption from $650,000 to $800,000. It will reduce stamp duty for first home buyers of properties worth up to $1 million. It will amend the First Home Owner Grant and Shared Equity Act 2000 to make sure that the First Home Owner Grant goes to people who will actually live in a home for a reasonable amount of time. It will also meet one of Labor's key election commitments: The Property Tax (First Home Buyer Choice) Act 2022 will be amended, doing away with the former Government's complex, unfair "forever tax". As the Premier has said, the bill will create a fairer and simpler system to ensure more first home buyers have a chance of owning their first property. From 1 July this year, these changes will apply to first home buyers who sign a contract to purchase a home and the changes will ensure that the assistance will be better targeted, with protections to ensure the integrity of the scheme.

The legislation will help more young people, particularly those on average incomes and in regional areas such as Newcastle and Lake Macquarie. I note that a lot of debate in this place on the previous bill was about people on the other side having a commitment to regional communities. I do not know why they do not support this bill in its current form, because it is aimed at assisting people who are living in the regions. More importantly, the legislation will not disadvantage the people who opted in to the land tax scheme. They will not be expected to pay stamp duty retrospectively. This Government's scheme will help more first home buyers, who currently would potentially be locked out of ever owning their own home, to take that step and buy a property so they can raise a family in a place that is safe and secure—a place that they can call home.

We will do that in an economically responsible way. I understand that members on the Opposition benches want to move amendments to keep their unfair forever tax system and adopt our fair and sensible proposal. That would cost the taxpayer some $700 million. At a time when an incredible budget crisis has been left to us, that is totally economically irresponsible. Taxpayers' funds are not a magic pudding. That was obviously what those on the other side thought when they were in government and why we are in a huge financial mess in this State, with $180 billion worth of debt, an $11 billion deficit and $7 billion of unfunded risks that those opposite hid while they were in government.

Unlike the previous stamp duty or forever tax scheme, the benefits of this Government's policy will not go disproportionately to the more well off. Under the previous model, those purchasing more expensive homes got bigger discounts, funded by the New South Wales taxpayer, compared with those purchasing a more modestly priced property. Everyone in New South Wales bore the cost of that scheme, but only the 13 per cent of people who could afford a million-dollar property for their first home received the lion's share of the benefit. The bill is good for our State. It is good for the majority of first home buyers, but it will be especially good for people living in my electorate and in regional electorates. After all, 45 per cent of people who received first home buyer assistance in the last financial year were based in regional areas. In contrast, 16 per cent benefited from the previous Government's land tax scheme.

In addition to our first home buyer scheme, this Government has ensured that our policies will support some of the most vulnerable members of our community. The member for Sydney rightly raised the plight of people who are homeless and who are victim-survivors of domestic violence. I appreciate and am thankful for his concern. I am pleased that the Government is expanding the Shared Equity Home Buyer Helper program to include access for victim-survivors of domestic and family violence. We have established a task force to improve housing outcomes for domestic violence victim-survivors, and I am incredibly pleased that Domestic Violence NSW has agreed to join that task force. Recommendations from the task force will be considered as part of the process in preparing the upcoming budget.

Providing safer housing and greater financial security is an incredibly important way in which the New South Wales Government can support domestic violence victim-survivors to achieve better long-term outcomes. It is one step that the New South Wales Government is taking in what will be an ongoing path towards making New South Wales a safer place for victim‑survivors. This Labor Government is absolutely committed to helping people—especially those people who most need help—to access safe and secure housing, and to fixing the housing crisis in this State. The bill is an important first step. I commend it to the House.

Ms FELICITY WILSON (North Shore) (21:33:58):

I contribute to debate on the First Home Buyer Legislation Amendment Bill 2023. We come to this place amidst a crippling housing affordability crisis across our State, particularly in Sydney. The context of the debate is that we are looking at an increase in the average Sydney house price in the last quarter of 1.5 per cent—that is about $18,300—to a median sale price of $1.459 million. Unit prices have increased 0.7 per cent over the three months to March to a median price of over $758,000. When we look at those facts and at what the housing market is currently doing for buyers across Sydney, we should be quite concerned about the position that the Government is taking today. In legislating its changes, it is shutting out the vast majority of people who are trying to buy a home from accessing any support as first home buyers.

Dr Hugh McDermott:

Rich people like your mates on the North Shore. Some can afford it more than others.

Ms FELICITY WILSON:

Those opposite do not seem to understand that people who want to buy a home live everywhere across this State, in every community—regional communities, city communities, in my electorate of North Shore and in the electorate of the member for Prospect. The member can make his own contribution to the debate; he does not need to contribute during mine. We just heard from the member for Charlestown that even in her community the median house price is well over $1 million in a number of suburbs. What the Government is proposing to us and to the people of New South Wales is a massive step backwards in any support for first home buyers trying to tackle the housing affordability crisis.

Everybody knows that stamp duty has been around for an incredibly long time. It was first introduced in 1865. The Minns Government is stating that that tax from the past is its tax of the future. It is winding back any attempt at reform of stamp duty in New South Wales when it is commonly agreed that stamp duty is an incredibly bad tax. We have known that since at least the 2010 Henry Tax Review, although most of us knew it was a problem before that. That review stated unequivocally that reforming stamp duty, and particularly abolishing stamp duty, would have significant impacts on housing affordability. Labor is reinstating stamp duty for more people across New South Wales without giving them any choice. It is also saying that it wants to govern for the few rather than the many.

About half of those in my community rent, about 20 per cent of people own a property with a mortgage and about 30 per cent of people own a property outright. It is a community where 50 per cent of renters are facing the incredibly difficult challenges of rising rental costs and reduced availability of rental properties. They also cannot get onto the property ladder. Labor's bill says to that 50 per cent of my community who are renters that they cannot live in their community if they want to own a home, because in my community the average price of an apartment is over $1.3 million. What does that do? The demographics in my community skew younger; millennials are the main demographic. We have young professionals. I speak on this bill as a representative of a community that has a lot of young people who cannot afford to buy a home, and as a millennial myself.

Labor is saying to younger people in this State that it has no view on ensuring that all young people can access the property market, when we know how crucial access to property ownership is for individuals' long‑term financial security. That is what the Government is saying to people in communities like mine and across New South Wales, including many individuals in Charlestown, Heathcote and Prospect. All the communities represented in this Parliament will have many first home buyers who will be shut out of accessing the market because of the retrograde step that Labor is taking with this legislation. The former Government tried to provide choice by legislating on this issue. We said to individuals that they are best placed to determine their own financial pursuits and the best way to utilise their own money, whether that be buying an investment property without these kinds of incentives or buying a first home and choosing to have a short-term land tax cost versus the huge up‑front cost of stamp duty.

I referred earlier to that $1.3 million average in my community. That attracts over $55,000 in stamp duty. Under the reform that we introduced, first home buyers would instead pay just over $3,000 in annual property tax. That would get them into their first home much sooner. I acknowledge that members opposite have this notion that the tax is forever. They do not seem to have noticed the stats that state that first home buyers generally stay in a property for a maximum of 10.5 years. First home buyers are shackled by stamp duty today. We know that stamp duty is an impingement on mobility. When the stats state a maximum of 10.5 years, members opposite know for a fact that it is not a forever tax and that it is a choice. No longer giving individuals choice about their access to the housing market is taking away their ability to get into the property market. I refer to the Herald's editorial on 24 May. Obviously Labor made a promise at the election to abolish stamp duty in some way or form, but the article stated:

But it delivers little benefit: the eligibility to escape stamp duty is so limited it does little to help young people shut out of home ownership, not least because average and median house prices are way above the stamp duty-free threshold or concessional rate.

Labor is legislating concessions that people will not even be able to access. I refer to the thousands of home buyers that will be left out in the cold. In suburbs such as Camden, Oran Park and Sutherland, the median house price is between $1 million and $1.5 million. The legislation that Labor is putting before the House will shut people out of home ownership in their communities and in my community. It will shut them out of home ownership forever. Government members might have called First Home Buyer Choice a forever tax—a misnomer—but they are now shutting first home buyers out forever.

People in my generation, as the member for Charlestown said, are opting out of the notion of ever being eligible to buy a home in Sydney or across New South Wales. That might seem like a strange concept to most people in this place, particularly members on the other side of the Chamber, because generationally they have had access to the types of incentives that young people have not had. I am a renter. I am a single mother with small children. Where is the capacity for people like me to get onto the property ladder? They do not have the opportunity to access the property ladder. This legislation entrenches that for the long term. We strongly believe that people should have the choice to make decisions that best reflect their personal financial circumstances and this legislation takes that choice away.

This legislation was an obsession for Labor members last year. They were obsessed with it during the debate. I am not sure if they understood the crux of it and the choice that it was providing people in the communities they represented then and in the communities they represent now, having won more electorates in the election. They are forcing young people to pay tens of thousands of dollars—$40,000, $50,000 or $60,000—in stamp duty and if they cannot put down a 20 per cent deposit, they have to pay lenders mortgage insurance on top.

Members opposite are not just putting people back years from buying a home; they are telling them they can never buy a home. That is in almost every postcode across Sydney, let alone outside of Sydney. The local community that I represent has a high young and working population because it is so close to the city. I am incredibly concerned about what this legislation will do to them. As I said, half of my community rent. There is a notion that they will always have to rent and therefore be at the whim and vagaries of the rental market, property availability and increasing prices, as are currently occurring, rather than having the financial security and long‑term stability of getting into the housing market.

Extension of time

The evidence proves over and again that stamp duty is a reductive tax. We know it prevents mobility. We know it prevents people from making choices about their lives. It does not reflect the way in which we want people to make decisions or take up opportunities, which will ensure they can move between communities and do things that are best for them. Whacking this huge up‑front cost on individuals ensures that only those who already have a lot of wealth can dream of owning a property. I know Labor members want to throw out a lot of misnomers about silvertails and wealthy individuals, but they are actually lambasting their own communities where the median property price is also over a million dollars. We know that leading real estate bodies and experts have rallied against this legislation. []

I note that one of the key components of the Liberal‑Nationals election campaign was to extend access to First Home Buyer Choice to women and particularly victim-survivors escaping domestic violence. A number of members talked about domestic violence this evening. Older women are the group that has experienced the highest increase in poverty in our nation. The evidence shows that owning a home is more significant for long‑term financial security than even having a high superannuation balance. The commitment that we made to ensure that those escaping domestic violence, even if they may have purchased a property with a former partner, are considered and counted among first home buyers has been left out of this legislation. That is very concerning because we all agree that this cohort of individuals deserve a new chance and an opportunity. They are more often women than men and quite often women with children who need and deserve a secure home. I encourage members opposite to consider that and incorporate it into the legislation. They still have a chance to do that.

I will end on another quote from the Herald op-ed on 24 May, which was pretty scathing of Labor and its approach. We all understand the housing affordability crisis and every member will talk about it. I do not know how many people in this House live the housing affordability crisis. We are well paid compared to the rest of the community. We are incredibly privileged compared to most of the community. If we want to walk in the shoes of the individuals who need and deserve access to this sort of support to get into the property market, then we should be listening to and engaging with all those individuals and looking at the barriers that are preventing them from achieving long-term financial security. The Herald talks about its support for phasing out stamp duty. It stated:

Lifting the threshold on eligibility to avoid paying stamp duty is an illusory fix for the housing crisis.

The Minns government's persistence with an outmoded money raiser … is a retrograde step that risks NSW falling behind as other governments look at reforming a major source of revenue for state coffers.

I call on the Labor Government to reconsider this "retrograde step" of continuing with stamp duty as the main tax on first home buyers getting into the property market. I ask them to consider long‑term reforms and how incredibly negative stamp duty is for people across New South Wales, and to take bold steps to create change that will contribute to addressing the housing affordability crisis.

Dr HUGH McDERMOTT (Prospect) (21:47:26):

It is an absolute pleasure to address the House on the First Home Buyer Legislation Amendment Bill 2023, which is another key piece in the reform agenda of the Minns Labor Government. It comes from a commitment during the election campaign to help young families, individuals and couples who need a home. This piece of legislation is key to the reform agenda for New South Wales and will lead to greater affordability for first home buyers not only in my community in Prospect and throughout Western Sydney but also throughout regional New South Wales.

The bill will amend the Duties Act 1997, the Property Tax (First Home Buyer Choice) Act 2022 and the First Home Owner Grant and Shared Equity Act 2000. It will help more people buy their first home and give them assistance during the current housing affordability crisis that was caused by the previous 12 years of a Tory government that did nothing to help working families throughout New South Wales. Under the bill, the first home buyer stamp duty exemption threshold will increase from $650,000 to $800,000. The concession threshold will increase from $800,000 to $1 million. Stamp duty will be abolished for first home buyers buying houses up to $800,000 and will be significantly reduced for homes between $800,000 and $1 million.

That reflects my community and the house prices in Prospect. In fact, those are the house prices in the communities of Mount Druitt, Wollongong, Heathcote, East Hills and other places. They are not multimillion‑dollar houses like those on the North Shore or in the eastern suburbs. It is houses at around $800,000, which families want to be able to afford to buy. My own family bought a house in Greystanes in 2011—the first home for me and my young family. The average price was $495,000, which was how much we paid for it. House prices have gone through the roof since then. In my suburb they are increasing by around 30 per cent a year, which is unbelievable. We need to address that. Schedule 1 to the bill will amend the Duties Act 1997 No. 123:

Schedule 1[1]Duties Act 1997

amends various residence requirements under the to require a person to reside in a home as the person’s principal place of residence for a continuous period of at least 12 months to be eligible for a duty exemption or concession.

Schedule 1[2]

provides that to be an eligible agreement or transfer for the purposes of the First Home Buyers Assistance Scheme, a property having a private dwelling built on it must have a dutiable value of less than $1,000,000, rather than $800,000 as is currently the case. …

Schedule 1[3]

provides that to be exempt from the payment of duty under the First Home Buyers Assistance Scheme in relation to an eligible agreement or transfer, a property having a private dwelling built on it must have a dutiable value of less than $800,000, rather than $650,000 as is currently the case. …

Schedule 1[7]Duties Act 1997

inserts a transitional provision to make clear to which agreements or transfers the proposed amendments to the apply.

Schedule 2 to the bill will amend the Property Tax (First Home Buyer Choice) Act 2022:

Schedule 2

prevents a person making an election to pay property tax rather than stamp duty on a transfer of land occurring on or after 1 July 2023, unless the transfer conforms with an agreement for sale or transfer entered into before 1 July 2023.

Schedule 3 to the bill will amend the First Home Owner Grant and Shared Equity Act 2000:

Schedule 3

requires first home buyers to reside in the home as their principal place of residence for a continuous period of at least 12 months to be eligible for a First Home Owner Grant.

Those quite clear reforms overturn some of the things the previous Coalition Government put in place that really benefited only the wealthy end of town and did not help families in Western Sydney. The home buyers in the electorate of Prospect are young families, couples and individuals—hardworking members of our community. Five out of six future first home buyers in the electorate of Prospect will benefit from the scheme. I am sure that is reflected throughout New South Wales, but certainly in our Western Sydney community.

Mr Alister Henskens:

So one in six will not.

Dr HUGH McDERMOTT:

Here is the man who called himself Rumpole. Do you have something to say?

Mr Alister Henskens:

No.

Dr HUGH McDERMOTT:

No? You should be hanging your heads in shame rather than yelling out abuse. Five out of six future first home buyers will benefit from the scheme. That was not the case for the previous legislation from the previous Government. The targeted assistance will provide first home buyers with an apartment or a modest house in Western Sydney. That is important because people want a home to raise their families in and feel secure. It is becoming increasingly difficult for young people, families and couples to buy a home for the first time, especially when they are competing against wealthy investors and established home owners. The bill will help more young people, more working people on average incomes and more people in regional areas to become home owners. About 84 per cent of first home buyers pay less than $1 million for their first home. Just 13 per cent of home buyers can afford a home between $1 million and $1.5 million. The bill will apply to first home buyers who sign a contract to purchase a home on or after 1 July 2023 and will improve the integrity of first home buyer assistance programs in New South Wales.

I will give some examples in the electorate of Prospect where the bill will have a positive impact. First, a family in Seven Hills paying about $755,000 for their first apartment will not pay any stamp duty and will save $21,844 under the bill introduced by the Minns Labor Government. A family buying their first home in either Smithfield or Fairfield West, where the average apartment price is some $906,000, will only have to pay $16,000 instead of the $36,000 that they had to pay under the Liberals—plus they will not have to pay land tax. A number of concerns have been raised by the Opposition. The old Liberal-Nationals Government's scheme only gave first home buyers the option to avoid stamp duty if they were prepared to pay the land tax.

TEMPORARY SPEAKER (Mr Clayton Barr):

Order! The member for Wahroonga will come to order.

Dr HUGH McDERMOTT:

That gave too much assistance to people who could already afford homes worth more than $1 million and not enough to the majority of first home buyers who are saving to buy more modest first homes. The Liberal-Nationals Government's scheme just replaced one tax with another tax and looked after the wealthy end of town, not working singles, couples or families in Western Sydney. The First Home Buyer Legislation Amendment Bill 2023 will support first home buyers who want to achieve their dream of buying their first home and finding a safe and secure place to live and raise their family. I commend the bill to the House.

Ms JENNY LEONG (Newtown) (21:55:55):

The Greens support the First Home Buyer Legislation Amendment Bill 2023. While The Greens want to see an equitable transition from stamp duty to a broad-based, progressive land tax, that is not what the First Home Buyer Choice scheme amounts to. Thanks to our Greens colleagues in the Australian Capital Territory, who helped to shepherd in a landmark stamp duty reform in collaboration with the Territory Labor Government, we know what genuine reform in this area looks like. The First Home Buyer Choice scheme is simply not it.

The inquiry secured by The Greens in the upper House when the scheme was first introduced by the previous Liberal-Nationals Government showed us that the First Home Buyer Choice scheme was neither a housing affordability measure nor an equitable transition away from stamp duty to land tax. So what was it? It was little more than a half-baked attempt at housing policy reform that was always intended to be temporary and that the former Coalition Government rushed through in the final sitting weeks before an election. The Greens did not support it as good policy then, and we do not support it now. While we absolutely support long-overdue reforms to stamp duty in this State, and we want that reform to go further towards implementing a progressive land tax system, we cannot have the complex conversation required to do that if we use scare-tactic rhetoric about a forever tax on the home. The Greens and progressive housing tax advocates expect better from Labor, and I hope that as the conversation continues we can leave that kind of rhetoric aside and talk about the big challenges we face in the housing system.

In the past six months since the scheme was introduced, it is reported to have "saved" first home buyers $199.8 million in stamp duty. But to put it another way, the State Government has forfeited almost $200 million to subsidise the private property market. Imagine what that almost $200 million could have done to actually support housing affordability in the midst of a worsening crisis. We could have built new public housing. We could have refurbished existing public housing dwellings that are currently uninhabitable and therefore sitting empty. We could have provided cost-of-living support for renters struggling to meet their weekly housing costs. The list goes on. Instead, nearly $200 million was used to marginally subsidise the cost of home ownership, predominantly for the slim minority of first home buyers who buy properties worth between $1 million and $1.5 million.

Over the past few weeks we have heard from people in our communities and we have heard concerns being raised within the Newtown electorate and beyond. Understandably people are concerned that rising property prices are making it impossible for them to make the jump to buy a family home near their schools, their public open spaces or their communities. We know that many people are absolutely desperate right now to scrape funds together to purchase a home so that they can escape the completely cooked rental market, even if it means going into massive debt and buying into an overheated property market to do so.

It is clear that the entire private housing system is broken for renters, first home buyers and people with a mortgage across the board. The only ones not suffering now are big investors and property developers who are continuing to profit from other people's desperation and housing insecurity. It is also clear that funding private home ownership is not the solution. Instead, we need to reform rental laws to better protect tenants, offer longer leases, implement rent controls and freeze interest rates now as well as rents. Federally, we need to address tax handouts and concessions. We need to advocate for more than what the Federal Government is investing in funding for public and social housing.

Rental prices have continued to ascend to astronomical heights as vacancy rates have plummeted, painting an incredibly grim picture for people who rent across the State. In their contributions to this debate a number of members have talked about the rental crisis in their areas. I urge members to look at this more closely in the coming weeks when I lead for The Greens and introduce a rent-freeze bill to this Chamber. We can look at putting in place a two-year rent freeze to help ease the pressure on people who are currently facing a rental crisis while we move through the reforms this new Labor Government has introduced that addresses things like ending unfair no‑grounds evictions and other changes that would see a pressure lift on the cost of living.

We need time to get that legislation and those reforms right. I note the Minister for Planning is in the Chamber. He has a vision for how we can increase supply. We need to increase the supply of affordable housing in New South Wales. While we go about working together on that project and ending unfair evictions, putting in place a two-year rent freeze would be a sensible measure. We saw the benefit it had during the pandemic. It is a sensible measure that will take the pressure off families and other people renting right now while we make those legislative changes. Rental prices have continued to increase to astronomical heights. There is cold comfort in the promise of being able to choose between a lump sum, stamp duty and an annual property tax for two-thirds of low-income renters who can barely afford to pay their weekly rent let alone even think about the idea of purchasing their own home.

The Greens support raising the stamp duty exemption threshold in this legislation to $800,000 and the concession threshold to $1 million in recognition of the fact that 84 per cent of first home buyers purchase a home for less than $1 million. We welcome the extension of residents' requirements for first home buyer benefits from six months to 12 months. The Greens will always support closing any loophole that allows investors to reap the benefits that were made for people who intend to live in their homes. We know that the real issue underpinning every debate on housing affordability in this place is the fact that investors and property developers are still making a profit from housing, which should be a universally accessible human right.

Stamp duty may be an old-fashioned tax that we want to see phased out, but it is far from the only barrier that people face when it comes to housing affordability in this State. Stamp duty should never have scrapped at the expense of losing revenue that could have been used to fund real solutions to the housing affordability crisis, like providing public and social housing, and homelessness and crisis services for those who need it most. A healthy tax base that can fund the social services our communities need is one of the best ways to redistribute public wealth, and address inequality and financial disadvantage.

While The Greens absolutely support the bill before us and rejected the so-called First Home Buyer Choice scheme, we recognise that it is important to talk about the idea of a shift from stamp duty to a broad-based progressive and equality-based land tax. But we will never be able to have that very hard and complex debate if we resort to tactics where social media tiles and media grabs start using phrases like "a forever tax on your home". We need to move beyond that. The people of New South Wales expect better from us. We need to find a solution to move forward and we need to have a complex conversation about developers, investors and those who are making a profit out of the insecure housing market that is causing people in our communities so much stress.

The Greens support the bill. We look forward to seeing well-thought out and substantive reforms that deal genuinely with improving housing affordability in this State. We hope that we can move beyond the wedge politics that invokes discussions of forever taxes, nimbys or yimbys. We hope to find a solution that focuses on delivering affordable social housing and significant rental reforms for our communities.

Mr EDMOND ATALLA (Mount Druitt) (22:04:56):I make a brief contribution in support of the First Home Buyer Legislation Amendment Bill 2023. I commend the work by the Treasurer in the other place, and the Minister for Planning and Public Spaces, in introducing the bill to the House as one of the Government's mandated bills to address housing affordability for first home buyers. Owning a home has traditionally been considered the great Australian dream. Owning your first home is often seen as a significant milestone in life, representing financial success and a form of investment for the future. The former Government's scheme known as the forever tax only gave first home buyers the option to avoid stamp duty if they were prepared to pay a yearly land tax instead. That scheme will not help first home buyers with the affordability crisis. In fact, that scheme will destroy the Australian dream by imposing a forever tax on those that are vulnerable and very desperate to enter the housing market for the first time.

At the election we promised that, if Labor formed government, we would reform this area for first home buyer grants and tax incentives. The bill goes to the heart of that commitment, and we ask the Opposition to respect the mandate given by the people of New South Wales. I understand that the Opposition will be asking that we keep both schemes—that is, we keep the former Government's forever tax and Labor's proposed first home buyer grant scheme. However, if both schemes are kept, each of the two programs will cost the people of New South Wales $700 million per annum, a total of $1.4 billion annually.

This proposal by the Opposition goes to the heart of the reckless spending that the former Government has been accustomed to. In fact, since coming into government and having the finances of the former Government exposed, we find that we have inherited a massive debt that will be $187 billion by 2026. We have inherited an annual interest bill of $7 billion, a budget blackhole of $7.1 billion and a current deficit of $11 billion. History will show that former Government members were not economic managers. In fact, they are now exposed as economic wreckers or vandals.

The voters of New South Wales resoundingly endorsed our approach to address the issue of housing affordability for many first home buyers. In fact, 84 per cent of first home buyers will receive a boost to help them compete with investors and established homeowners. Thebill ensures that the assistance given by the Government is appropriately targeted to those who need it most—

Mr Alister Henskens:

You didn't write this.

Mr EDMOND ATALLA:bringing about detrimental impacts upon the broader housing market. I note my contribution to debate is above the member's intelligence level. It is worth examining precisely how the bill will meet its objectives in aiding first home buyers in our State. In introducing the bill,the Minister for Planning and Public Spaces clearly articulated the specific measures that will address concerns. They are worth mentioning again, given the extent to which the bill will instigate profound enhancement to the lives of so many people in this State.

I did—without

I mentioned that this bill will better direct Government support to first home buyers, and one way in which it achieves this is through making the eligibility criteria for a duty exemption or concession more stringent. The Duties Act 1997 will be amended to require a first home buyer to live in the property for at least 12 months, which is longer than the current six months, to meet the eligibility criteria. This measure will more accurately target Government support to first home buyers—those wishing to purchase a place in which to live—rather than those looking for a placein which to invest. The bill will further amend the Duties Act 1997 to increase the values of properties that fall under the scope of the First Home Buyer Assistance Scheme. The first home buyer stamp duty exemption threshold will increase from $650,000 to $800,000, and the concession threshold will increase from $800,000 to $1million. For example, a family in Western Sydney—similar to the example given by the member for Prospect—who purchases their first home for under $800,000 will not pay any stamp duty and will save around $22,000 under Labor. This will apply to first home buyers who sign a contract to purchase a home on or after 1 July 2023.

The legislation will also improve the integrity and targeting of first home buyer assistance programs by increasing the requirement to live in the home from six months to 12 months. This residence requirement will apply to the First Home Buyer Assistance Scheme, first home buyer grantsand duty deferral for off‑the‑plan purchases. The former Government's forever tax will end on 30 June 2023. People who choose this tax will continue to pay land tax until they sell that property. They will not be asked to pay their stamp duty retrospectively. The applicable values for vacant blocks of land remain unchanged. The former Government's land tax, described as a "forever tax", was introduced just before the election without a mandate. The election was a clear judgement on the former Government's signature policy, which in the long term will result in first home buyers who opted for the forever tax paying thousands of dollars more than what is proposed under this bill.

The Minister for Planning and Public Spaces made it clear who were the beneficiaries of the policies of the former Government. In summary, it was the purchasers of properties valued between $1 million and $1.5 million who could opt out of paying stamp duty and opt in to paying a forever tax, or land tax. This Government wants home ownership to be within the grasp of as many people as is practicable. The amendments brought about by the First Home Buyer Legislation Amendment Bill 2023 will go quite some way towards achieving this goal. I thank the Treasurer and the Minister for Planning and Public Spaces for their work in introducing this important bill to the House. It will be the difference between people owning their first home or remaining in the rental market forever and crushing their Australian dream of home ownership. I commend the bill to the House.

Mr JUSTIN CLANCY (Albury) (22:12:38):

I join in debate on the First Home Buyer Legislation Amendment Bill 2023 to point out that the legislation builds on one part of the Coalition's existing program to assist first home buyers by extending the threshold by $150,000 and by requiring a person to reside in a home as the person's principal place of residence for a continuous period of at least 12 months for that person to be eligible for a duty exemption or concession. That is pretty much it—the beginning, middle and end of what Labor calls reform. The important part of Labor's thin policy lies in what it does not do for our State. Housing is one of the defining issues of this generation. Across the nation in almost every city and town there are issues of affordability, supply and suitability. First home buyers face a tough market, particularly now with interest rate increases biting hard. Inflation has been rising.

Families are helping out if they have the means. Students are needing accommodation; short-term rental properties are locking out first home buyers; and there are tourism, migration and post‑COVID impacts on housing choices. The list of factors affecting property prices and availability is extensive. I make two points in relation to this bill. First, why is the Government so afraid to give the people of New South Wales choice? On the Opposition side of the Chamber sit members of parties who work to give people choice in their lives, and options for their decision-making. We do not look at a problem with our first thought being, "Can we trust the people of New South Wales to make their own choice?" or "What can we do that has been done before, and present it to the media as something new and insightful?" Choice should not be underrated. Revenue NSW data from 30 May reveals that 5,210 properties were purchased by taking advantage of the Coalition's First Home Buyer Choice.

This is about real people. In human terms, that is 8,461 home buyers who have been helped already—2,865 of whom are aged 30 or younger. The up‑front duty saved by these new home owners amounts to $199 million. In the Murray-Lower Darling the up‑front duty already saved is $181,000; in the Riverina, it is $543,000. First Home Buyer Choice offers an alternative and it is an opt-in decision. It is not mandatory. The former Government made it available and the public responded by taking up the opportunity. First Home Buyer Choice should not be thrown away just because it perhaps does not fit with Labor's ideology, or because giving people choice about how they will spend their money is not the Labor way. People are signing up. They are saving money. They are getting into their first homes.

Secondly, where is the Government's ambition to be better—to be smarter than to offer just a raising of the threshold? It was the NSW Productivity Commission's submission of September 2021 to the Federal inquiry into housing affordability and supply in Australia that pointed out the challenge for government—and what will be the true test of its economic credentials. The Productivity Commission noted that among the State's major revenue sources, stamp duty on property is widely considered the most inefficient tax. "Inefficient" means that stamp duty imposes the largest economic cost of all existing taxes. The commission contrasted this with a policy direction in favour of a broad‑based land tax on the unimproved value of land, which it described as "the most efficient tax available to the States ..." and said:

Switching, therefore, from transfer duty to a broad-based land tax would enhance economic efficiency in the housing market and support a more equitable distribution of the tax burden. It would also provide a stable and sustainable revenue source to fund government services.

The commission also argued that, without underlying tax system reform, a government risked making things worse for home buyers through its dabbling in the housing marketplace—I emphasise that point. In the words of the commission, the problem with first home buyer assistance is that it can "significantly increase housing demand without necessarily increasing supply". The commission also stated:

Moreover, the incentives bring forward purchases that may have happened anyway, as well as bring people into the market who would not have otherwise been there.

The Productivity Commission concluded:

The Sydney Morning Herald

Without a commensurate supply response, this places upward pressure on prices and reduces housing affordability. The other comments the Productivity Commission makes are around mobility. We talk about the youth of today and the challenge of entering the housing market that is related to the ability of young people to find secure employment. As part of that, they may need to travel to other locations and will also need to find housing in those situations. We can keep going on the good advice from economic professionals by taking this back to the Ken Henry led tax review of 2010, which concluded that stamp duty on property transactions is "inconsistent with the needs of a modern tax system". editorial of 13 June 2022 uttered a sigh of relief when the Coalition got stuck into turning these important messages into action. The editorial read:

A much-needed overhaul of property taxation is finally afoot … There is an encouraging consensus about what should replace stamp duty. The Henry review, the Australian Productivity Commission and the 2020 NSW Review of Federal Financial Relations are among many to conclude a broad-based tax on land is the right substitute.

The Sydney Morning Herald

Does the Government want to be thought of as a progressive government? If so, it should try to follow this endorsement from :

Herald

The supports the abolition of stamp duty and welcomes the fresh momentum for property taxation reform in NSW and beyond. Perrottet has shown strong leadership in championing the overhaul of stamp duty. If he succeeds in ridding the state of this antiquated and inefficient tax it will deliver lasting social and economic benefits.

The Sydney Morning Herald

In a comment on Tuesday to , the writer noted that, "Apart from the Australian Capital Territory, no other State or Territory has had the courage to introduce the reform to land tax." It should be noted that the Australian Capital Territory introduced that land tax reform under the current Commonwealth Labor Minister for Finance, Katy Gallagher. Even Victoria's Government now sees no downside—but plenty of upside—in replacing up-front stamp duty with an annual property tax for commercial and industrial property. Even the Labor Government of Victoria gets it. Ideology from those on the Government benches is making way for tax reform that benefits the State economy—although the party still struggles with the idea of giving people ongoing choice and options.

When it comes to progressive reform of the State's economy—to make our State fit for the future—this VIP Lounge Government prefers to sit quietly in its own comfy lounge. It is a government that thinks reform is about removing VIP Lounge signs. It is a government that will remove reform when it comes to stamp duty and will lift the concession rate. It is a government that prefers to sit quietly in its own comfy lounge rather than dig into what needs to be done—whether it be gambling reform, truly assisting first home buyers across the State, or keeping the State's economy agile and responding to need. Where is the Government's sense of reform? All I can see is timidity.

Under the Coalition, New South Wales was the leading State in the nation. It had the strongest economy. It was the greatest builder of infrastructure and was the biggest funder of meaningful social improvement programs. Now we have a government lacking the stomach for reform. The Government is trying so hard not to upset certain interests that no-one has any hope it will get things done. I am committed to choice. I believe the citizens of New South Wales can be trusted to make the decisions that suit them best, and I have read the data that shows First Home Buyer Choice is working.

Mr ALISTER HENSKENS (Wahroonga) (22:22:44):

I contribute to the debate on the First Home Buyer Legislation Amendment Bill 2023. I congratulate the member for Albury on his excellent contribution. One of the key matters he emphasised was the fact that the bill does not represent true reform at all. In fact, what the bill does is what governments over many, many years have done, which is to seek to assist first home buyers by merely raising the threshold by which they do not pay stamp duty and give concessional rates for a certain segment of values. What has that actually achieved in the past? What it has achieved, in fact, is ever decreasing percentages of home ownership amongst young people between the ages of 25 and 34.

It has been a failed policy in the past. This Labor Government shows that it is backward thinking rather than forward thinking. It is not prepared to actually embrace a new way of doing things like the Coalition's First Home Buyer Choice legislation of last November. In failing to do so, it will condemn young people to not having their own home. That is the shame of the bill. The bill reduces choice and flexibility for first home buyers, which inevitably will reduce housing affordability for many people throughout Sydney, including in my electorate, which is why I oppose the bill unless it is amended.

Significantly, the bill—unlike the Coalition's bill last year—will provide no support whatsoever for first home buyers of properties between $1 million and $1.5 million. Those properties are right in the sweet spot of median home prices within Sydney, and certainly within my electorate. The Property Tax (First Home Buyer Choice) Act 2022 was introduced in Parliament last year to support the hopes and dreams of young people wanting to enter into the property market for the first time. Let us be clear: Home ownership is part of the great Australian dream and provides young people with financial stability and social stability. It is vital that young people are given the opportunity to enter the housing market, if they choose to, so that they can set themselves up for future success. It provides a great platform for their families and for their future security. Members know that the cost of stamp duty places a significant burden on people when they look to purchase a property. It can take people years and years to save up enough money to pay a lump sum stamp duty payment.

Just eight years ago, when I made my inaugural speech in this place, I said that stamp duty is a terrible tax. It is a tax against transactions. It is a tax against the economy. It damages so much and is such a bad tax that it should not exist. What the Coalition did in a small way last year through the First Home Buyer Choice legislation was to actually take away the distorting effect of lump sum stamp duty and replace it with a much more evenly spread tax over the life of property ownership. It is significant that the rhetoric from Labor about a "forever tax" ignores the fact that the average first home buyer sells their property within 10 years of purchase. They were financially better off by paying the First Home Buyer Choice land tax than they would have been paying a lump sum stamp duty—the sort of lump sum stamp duty that the Labor Party is perpetuating for properties between $1 million and $1.5 million. That includes many properties throughout Sydney, including many properties in my electorate.

Members know that the rate of home ownership in New South Wales has fallen from 70 per cent in the 1990s to just 64 per cent last year. In Australia, just 41 per cent of people aged 25 to 34 own a home, and the average age of a first home buyer has now risen to 34. The bill is not reformist legislation like the Coalition's First Home Buyer Choice legislation, which it will repeal. It is, in fact, just a slipping back to the same old way. I think it was Albert Einstein who said the definition of insanity is doing the same thing over and over again and thinking you are not going to get the same result. What Labor is doing is just going back to the sort of approach with regard to first home buyer support that has failed in the past and has decreased home ownership for young people progressively over decades.

We cannot do the same thing over and over again. The more the Government ignores the challenges of home ownership for the younger generation, the harder it will be to enter the property market. The signature legislation—the brainchild of Dominic Perrottet—that the bill will repeal was truly something different. The proof of the pudding is in the tasting, and people flocked to take advantage of the Coalition's reform. They flocked to pay an annual land tax rather than a large, up-front, lump-sum fee.

The Coalition's legislation gave people a choice. It showed confidence in people to make a decision about what was in their best interest. If they thought they were going to hold the property for 30 years, they would be better off paying a lump sum. If they thought they were going to hold the property for the average period of under 10 years and then upscale and buy another property, they would be better off paying an annual land tax. The Coalition gives people a choice and ignores the great flexibility and variety of people's circumstances within the community; Labor has a one-size-fits-all, Stalinist, "we know best for you" approach, which will make many people worse off as a consequence. Many people will simply be left out of any assistance at all, even many first home buyers who are buying a property under the median house price in Sydney.

This legislation is poor public policy. It is looking backwards rather than looking forward. It is ignoring the great benefits of the Coalition's reform that was introduced last year. It is unfortunate to see, after a promise of a new dawn for many young people, that their hopes and dreams are being snatched away by the Labor Party and this piece of legislation. It is a shame. More than 8,300 people have already taken advantage of the Coalition's policy since January of this year. An incredibly large number of first home buyers are recognising the benefits of the Coalition's policy. Here, the dreams of young people are being snatched away by the Labor Party yet again.

Unfortunately, there is a trend that this new Labor Government has no new ideas. It only has old ideas. Those opposite are plagiarists. They plagiarised their constitutional water reforms from Jeff Kennett and the Victorian Labor Party. They ran a scare campaign on tolls like Bob Carr did in the 1990s. They have got no new ideas. They do not respect a new idea like the Coalition's Property Tax (First Home Buyer Choice) Act 2022. They just want to keep being conservative. In fact, they are Tories if you think about it. They do not like change, they do not like innovation and they do not like progressive ideas like the Coalition's first home buyer choice legislation. It is unfortunate that we are condemned to four years of such a backward-looking, uninventive, uncreative Labor government.

Mr JAMES GRIFFIN (Manly) (22:32:49):

I oppose the First Home Buyers Legislation Amendment Bill 2023. I do so specifically as it seeks to abolish the Property Tax (First Home Buyer Choice) Act 2022. I wrote to the constituents in my electorate last year, saying:

I am writing to inform you about the NSW Governments new first home buyers policy to help get people into their first home faster ... The new policy means that eligible first home buyers can ditch upfront stamp duty in favour of a smaller annual fee on properties purchased up to $1.5 million. I wrote that letter because the policy would have appealed to the more than 50 per cent of people in Manly who are renters and to the great bulk of my entire electorate who are renting. In the initial months after the policy was implemented by the previous Government, it was the suburbs of Curl Curl and Dee Why, which are both in my electorate, that saw the most significant uptake of the program. In fact, they were in the top three suburbs making use of the program. First home owners and unit owners certainly did not reject the policy; rather, they enthusiastically embraced it. The median home price in Manly is sitting at more than $3.8 million. It is nearly impossible to purchase a home. It is nearly as challenging to buy a unit, with median unit prices at around $1.79 million, but you can sneak in under $1.5 million up around the Curl Curl and Dee Why area. That is why First Home Buyer Choice was so enthusiastically embraced by people buying in my electorate.

This evening I have heard from members opposite about how the previous Government initiative helped "those who are well off". To those members who have said how much this will benefit their communities, let me tell them about my community. The people in Manly, Curl Curl and Dee Why work just as hard as those in other parts of New South Wales. In Manly, Curl Curl and Dee Why there are households where both parents work. They work two jobs, juggle the pick-up and drop-off, get grandma and grandpa to help with the kids, look at the cost of groceries, watch the bank account to make ends meet and work their guts out—just as much as other people in this State—to get their foot on the property ladder. In fact, statistics show that it is families and parents in my electorate who disproportionately have both parents back at work full-time to either afford their first home deposit or pay the mortgage.

To have a choice to not pay stamp duty up to $1.5 million was a godsend. It was the difference for hardworking young people in my community to finally get their foot on the property ladder. Those opposite are taking away the choice. They are taking away the opportunity to buy a property in the place that these people love—where their kids go to school, where they have made friends and where they live with their family. It is an unfair bill. It is a retrograde piece of legislation.

For good reason, the Opposition seeks to amend the bill. We on this side will seek to delete schedule 2 to the bill and we will seek to index the new threshold set out in schedule 1. These amendments ensure first home buyers still have the ability to choose. They ensure the bill provides stamp duty concessions to first home buyers as property prices gradually grow over time. The Opposition seeks to amend the bill because first home buyers in Sydney and across New South Wales deserve choice. I say to my constituents and people who want to live in Curl Curl and Dee Why that this Government will be shutting the door on your opportunity to do that on 1 July when it axes First Home Buyer Choice. From that point, in the eyes of this Government, you are on your own.

Mr MATT CROSS (Davidson) (22:36:46):The Castle

I am pleased to contribute to the debate on the First Home Buyer Legislation Amendment Bill 2023. Tonight it gives me great pleasure to talk about an issue I spoke about in my inaugural speech: home ownership, specifically in relation to housing affordability. I spoke in my first speech about the challenge of home ownership in Sydney, particularly for my generation, generation Y. I stood for election to this place because I passionately believe that members need to play a role in making sure that everyone can have a home in this city, particularly a home they actually own. In my first speech I quoted the great Darryl Kerrigan, the character in , who said, "It's not a house, it's a home." But Darryl Kerrigan also said, "Tell 'em they're dreaming." That is what I say to the Labor Government today as it puts forward this reform. It is abolishing the great choice the current legislation provides. People can either choose up‑front stamp duty or a broad‑based land tax.

When coming to this place it really should not surprise me that Government members want to abolish this. From what I have seen, they have no 100-day plan. They have no legislative agenda and no ambition for economic reform. Earlier today I quoted from Bob Carr's book, in which he spoke about his great achievements when it came to privatisation. I cannot quote Bob Carr's book for this contribution as he actually did not do a lot of economic reform. Members know that in the last 16 years of Labor the amount of economic reform that took place under that Government was zero.

The March of Patriots: The Struggle for Modern Australia

When members think about great authors and great books, we cannot go past author and journalist Paul Kelly. In his book , he wrote about the great Hawke‑Keating Labor Government that made economic reform, but went on to write about the continued economic reform under the Howard‑Costello Government. All members of this House can agree that the floating of the dollar, asset recycling and the GST were all good economic reforms. As a part of the GST reform there was discussion about abolishing a lot of State taxes, including stamp duty and payroll tax.

Sadly, this Government is not committed to economic reform. It does not have that great burning passion that Hawke and Keating had for micro-economic reform. Post-pandemic it is more important than ever to undertake economic reform and be bold in our agenda because it is all about increasing productivity. Sir Robert Gordon Menzies spoke with great vision about housing affordability. It was only 81 years ago last week that he started his "Forgotten People" addresses about homes material, homes human and homes spiritual. I quoted him in my inaugural speech, and I expand that quote now. Menzies said about home ownership:

The home is the foundation of sanity and sobriety; it is the indispensable condition of continuity; its health determines the health of society as a whole.

Members in this place would agree that home ownership is important for the state of our society. Home ownership is harder to achieve now than it was in the past. In 1981 it took five times the annual salary to buy a Sydney median house. In 2021 it is now 14 times the annual salary. That is extraordinary. When speaking about housing and economic reform we must consider two things: supply and demand. Supply is simply about needing to have more homes in Sydney, but the bill is about needing to support the demand. The best way to assist the demand is the choice between stamp duty or land tax.

The March of Patriots: The Struggle for Modern AustraliaThe Daily Telegraph

I give credit to former Premier Dominic Perrottet, who in his premiership during a third term of government started undertaking the bold economic reform that I spoke about and that Paul Kelly described in . Perrottet put together an expert panel, which included the former New Zealand Prime Minister Bill English, to look at the Federation. The panel came up with a number of proposals, including the broad-based land tax stamp duty swap. That led to the economic choice that is at the heart of economic liberalism because it embraced the free market. It is the choice between stamp duty and land tax, which is an economic freedom that leads to liberty. When then Treasurer Perrottet, who went on to be Premier, put forward that reform I supported it. I wrote an opinion piece that appeared in on 6 December 2021. I said:

What challenges can be solved for the long-term? Housing affordability is a challenge, particularly for young people. Home ownership is their pathway to economic security.

Last year, then-Treasurer Perrottet announced a bold economic reform to give homebuyers the option to pay a long-term broadbased land tax over upfront stamp duty. Stamp duty is a major barrier, costing around $50,000 based on Sydney's 2020 median house price. This reform is just one of the many credible ideas being considered. But the sooner we get it started, the sooner we get a solution.

It was heartening that former Premier Perrottet got on with it. The Liberals and The Nationals did not take that to an election hoping to win first and then implement it later. It passed the lower House at the time because we had the numbers to pass legislation. The other place is always a bit more challenging. But we made the tough decision to roll the dice and take the challenge, and we were able to pass that reform. In 2020 the then Federal shadow Treasurer, Jim Chalmers, who is now the Federal Treasurer, made an interesting comment about Perrottet's plan. He said:

Subject to the details, we have an open mind to changes of this nature which could make the tax system fairer and improve labour mobility and access to housing. Thank you, Mr Chalmers. Assistant Treasurer Stephen Jones said, "Stamp duty on housing puts a brake of growth. It hampers labour mobility. It is also a barrier to downsizing and freeing up capital for retirement. It is a State tax, but it has national consequences." I appreciate those words from current Federal Labor politicians. But it does not end just there. Many people on the other side might remember Luke Foley. It is interesting that he put forward an idea, in the 2015 election campaign, that he would be helping first home buyers in New South Wales by allowing them to pay stamp duty on property purchases in instalments of five years. Labor lost that election, so it did not go ahead. But I am keen to acknowledge that Luke Foley put forward a policy that was at least about giving homeowners more options in relation to paying their stamp duty.

Finally, one person who needs to be quoted and whom the member for Albury quoted is the Victorian Premier. Last week, in relation to the Victorian budget, although not talking about first home buyers, he talked in a media release about stamp duty reform to boost business, industry and jobs. It said:

The Andrews Labor Government will deliver a landmark reform to abolish stamp duty for commercial and industrial properties, boosting business growth and expansion.

That type of thinking in Victoria, despite it not being for homeowners, does actually support businesses. A Labor Government in Victoria, one that has been in government for far longer than the one here, is still coming up with ideas and embracing ideas thanks to people like Perrottet, who pushed reform in that area. I quote further from Daniel Andrews' media release:

Removing upfront costs on commercial or industrial buildings will make it easier for businesses to get established and thrive, boosting economic activity, jobs and growth. It means a retail business can be more confident about moving to a new location, or a transport operator requiring additional space will have fewer barriers to expand.

You can see fighting words there from Victoria. I will ask something in my last 20 seconds. What happened when we put this great choice? Well, 8,354 first home buyers took up the offer. They saved $197 million on 5,140 properties. I say to those opposite that 2,331 live in Western Sydney. I do not support abolishing choice in this bill.

Mrs WENDY TUCKERMAN (Goulburn) (22:46:55):

I speak in opposition to the First Home Buyer Legislation Amendment Bill 2023 insofar as it seeks to abolish the First Home Buyer Choice. The contrast could not be clearer. On this side of the House, we stand for giving first home buyers a choice. Those opposite do not. This bill is another sign that our State will stall—and, even worse, go backwards—under the new Labor Government. Effectively, this bill will remove the choice, currently available to first home buyers purchasing a property valued at up to $1.5 million, to opt for a small annual property tax instead of upfront transfer duty. It will extend the residency requirement for which a first home owner or an eligible Department of Housing, community tenancy scheme or Aboriginal Housing Office tenant must occupy a home or otherwise incur a full transfer duty from six months to 12 months.

This change also applies to provisions about the principal place of residence for owner-occupied off‑the‑plan purchases and raises the threshold for a full exemption from transfer under the First Home Buyer Assistance scheme from $650,000 to $800,000 and the threshold for a concessional rate of transfer duty from $800,000 to $1 million. Note that no change is being made to the threshold for full exemption for transfer duty for the purchase of a vacant block of residential land, which is currently $350,000.

Much of New South Wales is facing serious housing pressure and rental pressure. The solution to this pressure is not to remove a policy that has been taken up by over 8,300 first home buyers since the First Home Buyer Choice began, on 16 January 2023. Around 440 first home buyers are benefitting every single week. First home buyers have voted with their feet in favour of the Liberals' and The Nationals' First Home Buyer Choice legislation. I note that the Minister in his second reading speech claimed that First Home Buyers Choice has been rejected by the people of our State. If it has been rejected, first home buyers would not have embraced it. If it has been rejected, why have two in every three eligible first home buyers taken it up? Removing the First Home Buyer Choice scheme will simply make it harder for people to enter the property market. It will force people to move away from their jobs, their support networks and their home communities. Individuals and families across New South Wales have collectively saved more than $197 million since the scheme opened on 16 January 2023. But under the new Labor Government's so‑called solution to housing affordability, thousands of first home buyers will be denied the basic choice between a small annual tax and a large up-front fee.

I address the proposed changes to stamp duty exemptions and concessions contained in the bill. It takes simple maths to demonstrate that for many first home buyers purchasing a property between $850,000 and $900,000 the Liberal-Nationals scheme of First Home Buyer Choice would still be more attractive than paying between $10,000 and $20,000 in up-front stamp duty. For at least the overwhelming majority of first home buyers purchasing a property over $900,000, the First Home Buyer Choice scheme offers a better deal. The Opposition believes that merely adjusting the stamp duty thresholds does not begin the real tax reform needed to move away from what is widely agreed to be a bad tax. The Liberals-Nationals introduced First Home Buyer Choice not only because it offers savings to first home buyers but as a significant first step toward broader reform of that widely agreed bad tax. Stamp duty was first introduced in 1865. A 158-year-old tax is what Labor is seeking to bring back to thousands of property transactions each year. It is far from a fresh start for New South Wales.

As I said, the First Home Buyer Legislation Amendment Bill 2023 is another clear sign that the new Labor Government is taking our State backwards. Housing affordability is at crisis point. It is against that backdrop that Labor seeks to remove the basic choice between a small annual tax and a large up-front fee. The Opposition cannot and will not support such a significant backward step. The Opposition will seek to amend the bill because first home buyers across New South Wales deserve a choice. For decades, governments have announced policy changes that tinker at the edges and exemptions and grants that over the years get introduced, wound back, introduced, modified, abolished and then introduced again. Sure, those policies have helped a limited number of first home buyers at a given point in time. But more exemptions and more grants have not solved the problem. They do not get to the heart of the issue. It is time for this Parliament to stick to real reform that offers lasting hope for future generations.

Mr GARETH WARD (Kiama) (22:52:13):

When I think about home ownership and housing I cannot go past a quote of former President Ronald Reagan when he said, "If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidise it." That has been the view of governments—Liberal and Labor—in both Sydney and Canberra over many years when it comes not just to how we deal with taxes around housing but also the planning system and a number of regulatory instruments that relate to housing and housing affordability. I think that all of us in this place would honestly say that we would support any change that genuinely helps particularly first home buyers into the market. All of us would agree that it is harder than ever before to capture that great Australian dream of home ownership and to be able to enjoy that piece of paradise that you can proudly call your own.

I come to the debate on the First Home Buyer Legislation Amendment Bill 2023 with a blunt sense of honesty and say that I have seen great policies but I have also seen a lot of failures. There is no one piece of legislation—and this is no exception—that will be the silver bullet and resolve all those issues. Labor members went to the election saying that they had a plan to raise the stamp duty threshold from $650,000 to $800,000. They are delivering on that promise today, but all of us would agree that this is a long way from what actually needs to be done. I commend my colleague the member for South Coast, who gave an exceptional inaugural speech in this place today. She talked about the need to increase housing supply in places like Nowra and close to services, transport and the things that people want. Having people moving around at night also helps with crime prevention. I agree with the contribution that she made.

Indeed, the bill is not a planning bill. I know that it will not resolve those issues. I certainly hope that councils, which can do a lot in relation to housing supply, will address those issues. I certainly look forward to working with the member for South Coast and other members of the House as we continue to deliver outcomes that see lower prices for property owners right around the State, as people really struggle with not just home ownership but also rents and the cost of living. I extend another bouquet to the Government. As a former social housing Minister, I commend the Government for its proposal for Homes NSW. Having the four agencies that regulate social housing under one roof, so long as they have the right levers to actually do something, is a sensible move.

I remember that in my time I was frustrated with the fact we had the Land and Housing Corporation, the Department of Communities and Justice, the Aboriginal Housing Office and the Department of Planning Industry and Environment under one roof. That made it so complex to deliver even the most basic outcomes to people who were doing it tough, including people who were living in homelessness and those in social housing, as well as getting people out of social housing by moving them along the housing affordability trajectory into, potentially, affordable housing and their first home, along with the things that support people to deliver that.

In my electorate, depending on which part of the electorate you talk to, there are different median housing crises. In Shellharbour the average housing price, according to realestate.com.au, is $1.1 million. In Kiama it is about $1.4 million. In the Shoalhaven it is around $1 million. These things are difficult to deal with. None of the people who are looking to purchase those properties will benefit from the proposals before the House. That is why I come to this debate wanting to see both systems fused so that we can ensure that people have a genuine choice when it comes to home ownership and so that people who are in properties under the $800,000 threshold can benefit from Labor's plan.

I do not see why the Government would want to change the current situation in relation to giving people a choice for properties over that threshold. I say that for two reasons. One is the obvious reason that people should have a choice if their personal circumstances are such that they would like to pay a broad-based property tax over the life of the property. Secondly, I cannot understand how Treasury would be in favour of the bill from the point of view that a broad-based tax that people have opted into provides greater budget certainty in the provision of revenue, which provides for services over the longer term. I do not quite understand why the Government would not simply say that that makes good economic and strategic sense. So I will be supporting the amendments that have been brought forward to ensure that the first home buyer scheme remains, because I believe in empowering people to make their own decision.

As I indicated, in my electorate the median housing price is well above the $800,000 that the Government's policy provides for. For that reason I do not want to deny people who are looking to purchase their first home in my electorate the benefits of this package. But I also say to the Treasury that I would have thought that, for good fiscal planning such as the Australian Capital Territory has enjoyed for many years, the policy makes sense and would have made sense should it have been allowed to continue to give people genuine choice, if that assists their circumstances.

On average, people save for about 2½ years to pay the stamp duty alone. Those are New South Wales Government figures, not mine. So if people have the option of deferring that, like we do with land rates, and paying it at a broad-based level, and they decide to make that choice—particularly for people who move around—I do not see why it should be prevented. I do not understand why the Government is seeking to limit that choice when, in so many electorates around the State, property prices are well above what is being legislated for. It may be different for people in unit blocks, and I accept that that argument has been made by members of the Government. But I also think that you can have both, and I do not see why we would not have both. I do not understand the public policy or strategic implications for moving in this direction.

Of course, there needs to be a much broader conversation when it comes to housing, and I mentioned at the start of my speech the excellent contribution from the member for South Coast in her inaugural speech today. But we also need to turn our minds to superannuation. Union-led super funds have been doing well off build-to-rent schemes that keep people in rental rather than home ownership. Every report I saw as the Minister for Families, Communities and Disability Services and any report that anyone wants to look at have said and will say that home ownership and poverty are interlinked. If we have the courage to unlock some components of super that people can use for their first home, that can make a real difference to people's lives: their life trajectory, and their chances of success and stability in retirement.

Whilst I appreciate the reasons that the Government has introduced this legislation—and whilst Government members may agree or disagree, publicly or privately, with the reasons for my position on the bill—this is just one element of a broad tapestry of measures relating to home ownership. To any member of the Opposition who might say, "This is all terrible; they are wrong", or any member of the Government who might say, "This is all terrific; you are also wrong", this is part of a broad matrix of reform that is required. As a Parliament, we should be mature enough to have that discussion—not just in isolation but also over the course of a number of pieces of reform—and also to advocate to the Commonwealth for changes that can make a real difference.

There are people in my electorate—and I am sure in many electorates—who are struggling along the housing continuum. Housing is a continuum. From those people I have met and seen on our streets through to those people who live in the lap of luxury, it is a broad continuum. But a large bulk of Middle Australia, of average people, just want to get by. They just want to be left alone and to be able to make the right choice for them. That is why I take the genuine view that the position of the former Government in relation to this matter made sense. It gave people an option to pay stamp duty up-front or to elect to pay a broad-based tax. Whilst I appreciate the reasons behind the Government's legislation, I do not understand why it is guillotining those choices that people can make that are right for them and for their family.

I simply say to the Government that I look forward to seeing more legislation that deals with housing affordability. This will be the start of many pieces of legislation that, to its credit, the Government has said it wants to introduce. I look forward to that. I look forward to the discussions around planning reform, density—building on the comments of the member for South Coast earlier today about density—transport corridors and services that address some of the most vulnerable. It might interest members of the House that the fastest growing rate of homelessness in New South Wales is women over the age of 55. They are people who generally may not have a huge amount of super who are looking for home ownership and who are wanting to get in. Supply is also a conversation that we should have. Assets like super is a conversation that should be had at a national level. For all the reasons that I have outlined, I will always stand on the side of first home buyers. I will always stand on the side of choice. I understand the reasons for the Government's legislation, but I will be supporting the Opposition's amendments to the bill.

Mr MARK COURE (Oatley) (23:02:19):

Housing affordability is one of the single biggest issues affecting young people. Tonight I speak in opposition to the First Home Buyer Legislation Amendment Bill 2023 insofar as it seeks to abolish the First Home Buyer Choice. The great Australian dream of home ownership has got much easier for a generation of young families. People have saved huge sums of money on the biggest purchase of their life under the First Home Buyer Choice program. To quote the former Treasurer, who is in the Chamber tonight, the First Home Buyer Choice has significantly reduced up-front costs, reduced the time needed to save for a deposit and will see a majority of first home buyers paying less tax overall.

We are giving people the opportunity to decide for themselves what best suits for their financial situation. Those buying a home to live in for life can still pay stamp duty. But for many, paying an annual tax for the limited time they actually live in the property will make more sense. The contrast could not be clearer. On this side of the House, we stand for giving first home buyers a choice; those opposite do not. We are the party of providing that choice and providing an opportunity for all; those opposite do not. In his second reading speech the Minister made mention of his Government's comprehensive plan to address housing affordability. I ask the Minister where is his plan? As I said, housing affordability is the single biggest issue affecting young families, particularly in my electorate but also right across New South Wales. We see here that there is no plan. There is no plan to support young Australians in New South Wales to own their home sooner.

The new Labor Government has presented nothing more than the bill, which is a significant retrograde step when it comes to housing affordability in Sydney and across New South Wales. The bill is another sign that our State will stall and—even worse—go backwards under this Government. This is poor public policy. There are no new ideas and no hope for young people. Sydney and much of New South Wales is facing serious housing and rental pressure. In fact, it is more than just pressure; it is a crisis. The solution to this is not to remove a policy that has been taken up by over 8,300 first home buyers since First Home Buyer Choice opened on 16 January this year. That is around 440 first home buyers benefiting each and every week. The solution is to support it and to encourage the take-up. First home buyers have voted with their feet in favour of our First Home Buyer Choice. That is very important.

This Government, on the other hand, has no mandate to withdraw the scheme. I note the Minister claimed that First Home Buyer Choice has been rejected by the people of our State. It has not been rejected; it has been embraced. Two in every three eligible first home buyers have taken it up. Of the over 5,000 properties that opted into the First Home Buyer Choice scheme, 45 per cent have been in Western Sydney. A first home buyer purchasing a median-priced home in Parramatta will avoid an up-front fee of up to $59,000 under the Liberal‑Nationals First Home Buyer Choice.

Ms Anna Watson:

Would you take a forever tax?

Mr MARK COURE:

You have had your chance. In Rockdale it is an up-front saving of $63,000 on a median-priced home. In the electorate of Oatley it is roughly the same at about $68,000 to $69,000. We know that the First Home Buyer Choice scheme can cut up to two years off the time needed to save for a deposit. Under First Home Buyer Choice members on this side of the House provided a ladder of opportunity for young people and many working families not just in western and south-western Sydney but also in my electorate. Removing First Home Buyer Choice will make it much harder—in some cases, almost impossible—for people to enter the property market. It will force people to move away from their jobs, families and support networks. It will force them away from their home communities. Individuals and families across New South Wales have collectively saved more than $197 million since the scheme opened in January of this year. What we will see under the Labor Government's so‑called solution for housing affordability will be thousands of first home buyers who will be denied a basic choice between that small annual tax and that large up-front fee.

I conclude by repeating that housing affordability and the cost of living are some of the biggest issues affecting young people in my electorate and across New South Wales. I am asking the new Government to think deeply about this. We already have a policy that is working. It is a policy that has been taken up by thousands of people right across New South Wales—45 per cent in Western Sydney alone. This is about making it easier for families entering into the property market for the first time and reducing up-front costs and the time needed to save for a deposit. It would see a majority of eligible first home buyers paying less tax overall. That can only be good public policy.

Mr MATT KEAN (Hornsby) (23:09:30):

The Opposition opposes the First Home Buyer Legislation Amendment Bill 2023 in its current form. I foreshadow that I will move amendments to the bill. In my second reading speech introducing the Property Tax (First Home Buyer Choice) Bill 2022, I said that that legislation:

… gives first home buyers a choice when buying a first home as to whether to pay an up-front stamp duty or to opt in to a small annual property tax. This legislation is founded upon a cornerstone value of this Government—the freedom to choose.

…

This reform will allow first home buyers to overcome one of the greatest barriers to home ownership and achieve their own Australian dream. Buying a first home is one of the most important milestones in a person's life. Homes are where families are raised, where they share time with friends and make memories to last a lifetime. However, too many young people today see the dream of owning their own place as out of reach.

That is why it is essential that the Property Tax (First Home Buyer Choice) Act not be repealed. I said:

Overall, rates of home ownership in New South Wales have fallen from 70 per cent in the 1990s to 64 per cent in 2021. For younger people aged 25 to 34, the national rate of home ownership sits much lower, at around 41 per cent in 2019-20. It is taking first home buyers longer than ever before to save the funds they need for a deposit and to pay stamp duty. In the 1990s it would take the median New South Wales household, putting aside 15 per cent of their income, around six years to save for a 20 per cent deposit on the median property in New South Wales and one year to save for stamp duty. It now takes that same household around 10 years to save for a 20 per cent deposit and two years to save for stamp duty.

The Opposition is committed to helping more young people across this State open the door to home ownership that too many feel is shut to them. That is why we will fight to preserve the opportunity for more first home buyers to enter the market. The Government is seeking to disempower first home buyers who want to fast‑track their path to home ownership by choosing the option that best suits their own financial circumstances and personal aspirations. I call on all members in this place to lend their support to the initiative that will empower first home buyers across New South Wales to realise their aspirations of home ownership and vote against the repeal of the right to choose.

The Government is seeking to deprive first home buyers of what has proven to be a very popular choice: to opt out of paying a large amount of up-front transfer duty of up to $66,700 and accept instead a small annual property tax. The bill would reimpose transfer duty of between $40,090 and $66,700 on those first home buyers who purchase a property for between $1 million and $1.5 million. Additionally, it would create a less favourable situation for most of those purchasing a property for between $850,000 and $1 million. In his second reading speech on the bill, the Minister for Planning and Public Spaces said:

A family buying their first home for the average price of $906,000 in Fairfield will pay around $16,000, instead of the $36,000 they would have paid under the Liberals—and, again, no land tax.

The Minister misstates the amount of transfer duty paid under Labor's plan by about 33 per cent. It would be $21,247, not around $16,000, as he misleadingly told the House. He also misleadingly states that under the Liberals they would have paid $36,000 in transfer duty. That is misleading because it ignores the key element in the excellent scheme that the bill seeks to abolish: choice. Under the Liberal-Nationals First Home Buyer Choice scheme, those first home buyers could choose to avoid the up‑front $35,860 in transfer duty and pay a small annual property tax. For a typical house in Fairfield valued at around $900,000, the break-even point would be around 29 years. That is well past the average 10 years that first home buyers stay for in their first home before moving on.

If First Home Buyer Choice remained an option with Labor's proposed concessional transfer duty, then it would still be around 15 years before the break-even point for a house and about 33 years for a unit. What the Minister described as "a sliding concession where a first home buyer purchasing just above $800,000 pays a small proportion of the full stamp duty that would otherwise be payable and a first home buyer purchasing just below $1 million will pay most of the full stamp duty that would otherwise be payable" when compared with the existing First Home Buyer Choice starts to be less favourable somewhere around a purchase price of $850,000, depending on whether it is a unit or a house and the ratio between purchase values and land values in a particular area.

What the Minister forgets is that the median house price in Sydney is now $1.2 million. That means Chris Minns and Labor are locking out first home buyers from many suburbs across our State and, I daresay, from many of the suburbs in your electorate, Mr Speaker—certainly many of the suburbs in my electorate and the member for Coogee's electorate. Many of the members in this House will see first home buyers not able to get into the market in their electorates. Under Labor's policy, first home buyers will have to pay full stamp duty to buy a median-priced home in, for example, Marsden Park, Bossley Park, Bankstown, Sutherland and Camden. Those suburbs are hardly in the top end of town. Traditionally, many young first home buyers would look to those suburbs to enter the market, yet they will be unable to receive any Government support. They will be locked out of those suburbs. In fact, according to CoreLogic's Home Value Index, which was released in April 2023, only the outer west and Blue Mountains regions have median house prices that would allow first home buyers to qualify for total stamp duty exemptions.

To preserve the choice that first home buyers have eagerly embraced, the Opposition will move an amendment to delete schedule 2 to the bill. That would have the effect of maintaining the First Home Buyer Choice scheme in full, and not just for those who were fortunate enough to take advantage of it before 1 July 2023. The amendment would leave in place the parts of the bill that increase the thresholds for a full exemption from transfer duty and a sliding concession on transfer duty. The previous Liberal-Nationals Government raised the threshold at which no transfer duty was to be paid by first home buyers to $650,000. The Opposition has no objection to raising the threshold further to $800,000. We must do everything we can to get aspiring working families into affordable first homes. That measure will save first home buyers up to $31,000 in stamp duty.

The Opposition will move a set of amendments to index the thresholds to annual changes in the median price of house transfers in Sydney for the June quarter each year. For example, the median price for the June 2022 quarter was 5.83 per cent higher than in June 2021. Indexing the thresholds to reflect fluctuations in the median cost of homes is a more sensible approach than waiting for the benefit of the threshold to be eroded for several years before increasing it in legislation. The third measure would increase the residency requirement for first home buyers to occupy their home for a continuous period of 12 months, up from six months. That requirement is also to be applied to eligible tenants purchasing a home under section 278 of the Duties Act 1997.

An eligible tenant is defined as a person who is a tenant of the housing department, a tenant under the community tenancy scheme administered by the Department of Family and Community Services or a tenant of the Aboriginal Housing Office. On the face of it, it seems counterproductive to the goal of freeing up public and Aboriginal housing to give a tax break in the form of an exemption from transfer duty to tenants seeking to purchase a home. Circumstances can change unforeseeably and that can affect where people need to live. Someone who has purchased a first home, or any home under section 278, should not face the unanticipated imposition of transfer duty because of unforeseeable circumstances such as new work opportunities, educational needs for children or adults, or family matters including as illness.

The Opposition welcomes clarification from the Minister on that aspect of the bill. While we will vote against the bill as it stands, we will support it if it is amended to preserve a genuine choice for first home buyers. Finally, I note the Opposition will include an amendment to make victim‑survivors of domestic violence eligible for stamp duty concessions under the scheme.

Mr PAUL SCULLY (WollongongMinister for Planning and Public Spaces) (23:18:46):

— In reply: I thank the Leader of the Opposition and the members representing the electorates of Heathcote, Sydney, Charlestown, North Shore, Prospect, Newtown, Mount Druitt, Albury, Wahroonga, Manly, Davidson, Goulburn, Kiama, Oatley and Hornsby for their contributions to debate on the bill. The hour is late and the views of members have been aired, so I will be brief in my reply. But I need to point out a number of things that were touched on during the debate.

Opposition members may not like it, but the Government was elected with a clear plan for addressing housing affordability and home ownership. Home ownership is an important goal for many Australians, and the Government intends to support each and every Australian in their pursuit of that commendable goal. For that reason the Government went to the last election with a clear policy platform to support first home buyers, targeting assistance to those buying a home for up to $1 million by expanding the First Home Buyers Assistance Scheme. It was a clear election commitment and, while a number of Opposition members suggested that the Government does not have a mandate for it, the fact is that the people did have their say on 25 March.

Through the bill, the Government is increasing the stamp duty exemption threshold for first home buyers from $650,000 to $800,000. The concessional duty threshold is also being raised from $800,000 to $1 million. That increased support will help first home buyers compete with investors and existing home owners in securing their first home. A lot was said about and a lot has been made of the suggestion that median prices in certain suburbs might mean that the concessions and the extension of the exemptions will not apply to many first home buyers, but I remind Opposition members that that stylised view of who the first home buyer is does not actually reflect reality. If they talked to most first home buyers, they would realise very quickly that first home buyers are buying the properties they can afford; they are not necessarily buying at the median price in any particular suburb. That said, the median price and the price that they can afford may coincide in some suburbs, and we are working to make sure that the targeted first home buyer assistance will support those lower income households. We are providing financial assistance to those who need it the most.

That is why Labor's assistance measures support first home buyers purchasing a home of up to $1 million, which roughly corresponds with the median home price in Sydney. When Government members say that this is a targeted policy, it does not mean that most people will not benefit; it is quite the opposite. In fact, Labor's first home buyer assistance package covers around five out of six or 85 per cent of first home buyers, who can now purchase their home with a stamp duty exemption or concession without the burden of an ongoing property tax on their family home. Further, a full 71 per cent of first home buyers will now pay no stamp duty whatsoever after the reforms.

I leave my comments there for the second reading debate, but I point out that in many of the contributions there was not a great deal of defence of or advocacy for the Opposition's amendments to the bill. Arguably, they skate close to the wind regarding standing orders like Standing Order 243. However, we will discuss those in depth during consideration in detail. I commend Labor's bill, Labor's reforms to stamp duty and Labor's efforts to build a fairer and more equitable first home buyer scheme to the House.

The SPEAKER:

The question is that this bill be now read a second time.

The House divided.

Ayes51

Noes33

Majority18

Motion agreed to.

Consideration in detail requested by Mr Matt Kean.

Consideration in Detail

The SPEAKER:

By leave: I will deal with the bill in groups of clauses and schedules. The question is that clauses 1 and 2 and schedules 1 to 3 be agreed to.

Mr MATT KEAN (Hornsby) (23:30:47):

By leave: I move Opposition amendments Nos 1 to 15 on sheet c2023-032 in globo:

Principal place of residence requirements

No. 1

Page 3, Schedule 1[1], lines 2 and 3. Omit all words on the lines.

Application to victims of family or domestic violence

No. 2

Page 3, Schedule 1. Insert after line 3—

[1A]Section 69A

Insert after section 69—

69ARegulations must apply scheme to victims of family or domestic violence

(1) The object of this section is to enable a victim of family or domestic violence to be eligible for a concession or exemption from duty on a similar basis to a person acquiring a first home if the victim—

(a)leaves home as a result of the violence, and

(b)within a reasonable time after leaving home, acquires a home.

(2)The regulations must contain provisions that give effect to the object of this section.

(3)Subsection (2) does not have effect until 1 September 2023.

(4)In this section—

acquire a home

includes acquire a vacant block of residential land intended to be used as the site of a home.

victim of family or domesticCrimes (Domestic and Personal Violence) Act 2007

violence means a person who has been the victim of a domestic violence offence within the meaning of the .

Indexation of amounts

No. 3

Page 3, Schedule 1[2], line 5. Omit "$1,000,000". Insert instead "$1,000,000, as indexed in accordance with subsection (3A)".

Indexation of amounts

No. 4

Page 3, Schedule 1. Insert after line 5—

[2A]Section 74(3A)–(3D)

Insert after section 74(3)—

(3A)On 30 September 2024 and on 30 September in each subsequent year, the amount in subsection (3)(a) must be adjusted—

(a)in line with the percentage change between—

(i)the amount reported for the June quarter in the same year, and

(ii)the amount reported for the June quarter in the previous year, or

(b)if an amount is not reported for the purposes of paragraph (a)—in accordance with an equivalent methodology prescribed by the regulations.

amount reported

(3B)In subsection (3A),  means the amount in the Median Price of Established House Transfers (Unstratified); Sydney as reported by the Australian Bureau of Statistics.

(3C)The Chief Commissioner must, before 30 September in a year, publish the adjusted amount that will apply on 30 September in the year.

(3D)The adjusted amount must be published in the Gazette.

Indexation of amounts

No. 5

Page 3, Schedule 1[3], line 7. Omit "$800,000". Insert instead "$800,000, as indexed in accordance with subsection (4)".

Indexation of amounts

No. 6

Page 3, Schedule 1[4]. Omit "$1,000,000" from the formula. Insert instead "A".

Indexation of amounts

No. 7

Page 3, Schedule 1[4]. Omit "$200,000" from the formula. Insert instead "B".

Indexation of amounts

No. 8

Page 3, Schedule 1. Insert after line 9—

[4A]Section 78A(2), definitions of "A" and "B"

Insert after the definition of N—

A

is the amount referred to in section 74(3)(a).

B

is the amount referred to in section 74(3)(a) minus the amount referred to in subsection (1)(a).

Indexation of amounts

No. 9

Page 3, Schedule 1[5], line 11. Omit "$800,000". Insert instead "the amount referred to in subsection (1)(a)".

Indexation of amounts

No. 10

Page 3, Schedule 1[6], line 13. Omit "$1,000,000". Insert instead "$1,000,000, as indexed in accordance with section 74(3A)".

Indexation of amounts

No. 11

Page 3, Schedule 1. Insert after line 13—

[6A]Section 78A(4)–(7)

Insert after section 78A(3)—

(4)On 30 September 2024 and on 30 September in each subsequent year, the amount in subsection (1)(a) must be adjusted—

(a)in line with the percentage change between—

(i)the amount reported for the June quarter in the same year, and

(ii)the amount reported for the June quarter in the previous year, or

(b)if an amount is not reported for the purposes of paragraph (a)—in accordance with an equivalent methodology prescribed by the regulations.

amount reported

(5)In subsection (4),  means the amount in the Median Price of Established House Transfers (Unstratified); Sydney as reported by the Australian Bureau of Statistics.

(6)The Chief Commissioner must, before 30 September in a year, publish the adjusted amount that will apply on 30 September in the year.

(7)The adjusted amount must be published in the Gazette.

Application to victims of family or domestic violence

No. 12

Page 4, Schedule 2. Insert after line 2—

[1]Section 4A

Insert after section 4—

4ARegulations must apply scheme to victims of family or domestic violence

(1)The object of this section is to enable a victim of family or domestic violence to be eligible to opt to make land subject to property tax on a similar basis to a first home buyer if the victim—

(a)leaves home as a result of the violence, and

(b)within a reasonable time after leaving home, is the transferee under an eligible transfer.

(2)The regulations must contain provisions that give effect to the object of this section.

(3)Subsection (2) does not have effect until 1 September 2023.

(4)In this section—

victim of family or domestic violenceCrimes (Domestic and Personal Violence) Act 2007

means a person who has been the victim of a domestic violence offence within the meaning of the .

Retention of First Home Buyers Choice

No. 13

Page 4, Schedule 2, lines 3–10. Omit all words on the lines.

Application to victims of family or domestic violence

No. 14

Page 5, Schedule 3. Insert after line 2—

[1]Section 7A

Insert after section 7—

7ARegulations must apply scheme to victims of family or domestic violence

(1)The object of this section is to enable a victim of family or domestic violence to be eligible for a first home owner grant on a similar basis to a first home owner if the victim—

(a)leaves home as a result of the violence, and

(b)within a reasonable time after leaving home, enters an eligible transaction.

(2)The regulations must contain provisions that give effect to the object of this section.

(3)Subsection (2) does not have effect until 1 September 2023.

(4)In this section—

victim of family or domestic violenceCrimes (Domestic and Personal Violence) Act 2007

means a person who has been the victim of a domestic violence offence within the meaning of the .

Principal place of residence requirements

No. 15

Page 5, Schedule 3, lines 3 and 4. Omit all words on the lines.

Mr Alex Greenwich:

Point of order: Mr Speaker, I draw your attention to Standing Order 243. I believe all the Opposition's amendments are in a breach of that standing order as they would classify as a form of appropriation, either by the indexation, proposing a new tax or broadening the scheme.

The SPEAKER:

I happen to have before me Standing Order 243, entitled "Message from Governor". It states:

The House shall not pass any vote, resolution or bill for the appropriation of any part of the Consolidated Fund, or for any other tax or impost to any purpose which has not been first recommended by message of the Governor …

I am sure all members are very well versed in that particular standing order. I was aware that there could be a conflict, so I have given some consideration to the matter. The member for Sydney proposes that all the Opposition amendments, Nos 1 to 15, are in conflict with that standing order. I respectfully disagree that that is the case with all the amendments. However, amendments Nos 2 to 14 are in conflict with Standing Order 243, which is based on section 46 of the Constitution Act 1902. They relate to a financial measure, which should be proposed by a Minister or recommended by a message from the Governor. Therefore, to prevent establishing an inappropriate precedent, I rule amendments Nos 2 to 14 out of order.

I draw to the attention of the member for Hornsby that that leaves on sheet c2023-032 Opposition amendment No. 1, which relates to a principal place of residence, and amendment No. 15, which likewise relates to principal place of residence requirements. I leave it to the member for Hornsby to decide whether he wishes to proceed with amendments Nos 1 and 15. The member for Hornsby has the call.

Mr MATT KEAN (Hornsby) (23:34:03):

Notwithstanding the Speaker's excellent ruling, the Opposition will proceed with amendments Nos 1 and 15. It stands by the position that first home buyers should have more choice and that more people should be able to enter the property ladder in New South Wales. That is why I commend the amendments to the House.

The SPEAKER:

The member for Hornsby has confirmed that he is proceeding with Opposition amendments Nos 1 and 15 on sheet c2023-032. I call the Minister.

Mr PAUL SCULLY (WollongongMinister for Planning and Public Spaces) (23:35:15):

—The Government opposes the amendments.

The SPEAKER:

The question is that Opposition amendments Nos 1 and 15 on sheet c2023-032 be agreed to.

The House divided.

Ayes35

Noes51

Majority16

Amendments negatived.

The SPEAKER:

The question is that clauses 1 and 2 and schedules 1 to 3 be agreed to.

Clauses 1 and 2 and schedules 1 to 3 agreed to.

Third Reading

Mr PAUL SCULLY:

I move:

That this bill be now read a third time.

Motion agreed to.