Contents
Introduction
Since July 2023, NSW has maintained its stamp duty concessions for first home buyers, but significant changes at the federal level in October 2025 have reshaped the landscape. Buyers now need to understand how state-based exemptions interact with the expanded federal Home Guarantee Scheme (HGS).
Current NSW Rules (as of December 2025)
- Concessional duty: Sliding scale applies for homes valued between $800,000–$1,000,000.
- Residence requirement: Buyers must move in within 12 months of settlement and live there continuously for at least 12 months.
- First Home Owner Grant (New Homes): $10,000 grant for new homes worth up to $600,000 (or $750,000 for house-and-land packages).
- First Home Buyer Choice Scheme: Ended in 2023; annual property tax option no longer available.
Federal Changes (from 1 October 2025)
- No income limits: Open to all eligible buyers.
- Higher property price caps:
- Sydney & major regional centres: up to $1.5 million.
- Other NSW regions: up to $800,000.
- 5% deposit without LMI: Buyers can purchase with a small deposit and avoid lenders’ mortgage insurance, saving tens of thousands.
How State and Federal Schemes Interact
- Even if you buy a $1.4m Sydney property under the federal scheme with a 5% deposit, you’ll still pay full NSW stamp duty.
- Buyers must carefully plan finances, as federal guarantees reduce deposit requirements but do not replace NSW tax obligations.
Practical Advice for First Home Buyers
- Factor in both state stamp duty rules and federal deposit guarantees.
- Seek legal advice to avoid misunderstandings (e.g., assuming federal support removes stamp duty).
- Prioritize properties under $1m if you want NSW duty relief.
Conclusion
The NSW exemptions introduced in July 2023 remain in place, but the October 2025 federal changes have broadened opportunities for first home buyers. Understanding the overlap between state concessions and federal guarantees is essential for making informed decisions in today’s property market.
Contact Information for Assistance
If you are a First Home Buyer looking to purchase a home and would like more information, contact us on 02 4288 0150 or admin@pdclaw.au today.
Lorri is a director of PDC Law. Lorri combines excellent technical expertise with a common-sense approach to best represent her clients. She is one of few Accredited Specialists in Commercial Litigation in the Illawarra and Shoalhaven. This accreditation is testament to Lorri’s expert knowledge and skill in dealing with commercial disputes. In 2019 Lorri was awarded Regional Lawyer of the Year by Women Lawyers Achievement Awards.
