Despite being one of the most hit states by the impacts of the pandemic, Victoria remained a viable place for many homebuyers in need of support.

Despite being one of the most hit states by the impacts of the pandemic, Victoria remained a viable place for many homebuyers in need of support.

McGrath Estate Agents founder and executive director John McGrath said while Melbourne is "not the shiniest star" among capital cities that are undergoing recovery, its comeback this year showed the local market's resiliency.

"If there was ever any doubt about the resilience of Australian property, Melbourne provides a case study of strength in adversity," he said.

Melbourne's median house price increased by 17.4% to $972.659 in the year to date, while its median unit price clocked a 7.8% gain to $621,898.

Meanwhile, Victoria's regional markets were able to take advantage of current conditions, striking price gains of 19.6% for houses and 19.8% for apartments.

"As Australia finally opens up, I expect Melbourne to rise again as one of the world’s most liveable cities," Mr McGrath said.

Most attractive incentives for homebuyers

Mr McGrath said the Victorian government's commitment towards property and construction is reflected in the available suite of homebuying incentives currently available.

The Victorian government recently increased the threshold for the existing off-the-plan stamp duty concession.

The price caps were temporarily increased from $550,000 for existing buyers and $750,000 for first-home buyers to $1m.

"The concession reduces the stamp duty payable by deducting the cost of construction incurred after the contract date from the purchase price to determine a reduced ‘dutiable value’ upon which stamp duty is charged," Mr McGrath said.

With this temporary change, buyers of higher-value apartments, which are usually downsizers, will be eligible for discounts until June 30, 2023.

Additional stamp duty discounts

Meanwhile, additional stamp duty concessions are available across the 14 suburbs within the City of Melbourne LGA.

The discount is available on new properties with a dutiable value of up to $1m and is open for both buyers and property investors.

Furthermore, buyers will not be required to pay any stamp duty on properties that have been on the market for a year or more since completion.

For newer listings, a 50% discount on stamp duty is available.

"This is an extra inducement to purchase new apartments in the city and surrounding areas such as Docklands, Southbank, Carlton, Kensington and Parkville," Mr McGrath said.

"Buyers can take advantage of both the off-the-plan concession discussed above as well as this concession to save big."

The Victorian government also provides duty concession for properties that will be used as principal place of residence.

This concession is available on new and established properties of up to $550,000.

For first-home buyers, a full stamp duty exemption is available on new or established properties with values of up to $600,000.

First-home buyers who are purchasing a property that has a value of over $600,000 and under $750,000 will enjoy stamp duty discounts.

On top of this, they can also apply for the $10,000 First Home Owner Grant.

Pensioners are also eligible for stamp duty exemption on properties valued at $330,000 or less and concessions for homes with values of up to $750,000.

Victorian Homebuyer Fund

The state government recently introduced a $500m Victorian Homebuyer Fund to help more first-home buyers break into the market.

The program runs as a shared equity scheme where the government can contribute up to 25% of the purchase price for the same equity in the property.

First-home buyers taking part in the scheme must earn less than $125,000 annually and must have a 5% deposit.

The income threshold for couples is $200,000.

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Photo by Simona Sergi on Unsplash.

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