Stamp duty: Record receipts add $1 billion to State Budget as housing crisis worsens

Record stamp duty receipts are on track to add $1 billion to the State Budget’s bottom line, fuelled by surging property prices and sparking calls for the tax to be overhauled or abolished. The Housing Industry Association says urgent reform is needed to stop seniors being locked-in to big homes, and first homebuyers being locked out of homes altogether. “Perth has (housing) affordability issues, but also a mobility issue,” HIA executive director Michael McGowan said. “If we can take stamp duty away, then mobility becomes a lot easier.” The State Government’s latest quarterly financial report has revealed that Treasury collected more than $1 billion from transfer duty for the first time, and is on track to collect $4 billion during 2025-26 above the $3 billion that was predicted and double the $2 billion that was collected in 2022. The increase is largely due to Perth’s rising property prices, up 12 per cent over the past year. A median house price of $830,000 results in a transfer duty of $33,860 on top of the sale price. Real Estate Institute of WA president Suzanne Brown said the threshold at which first homebuyers can avoid stamp duty - currently set at $500,000 - should be linked to median house price data. “Whilst the Government increased the thresholds as recently as March 2025, the updates have not kept pace with the market,” she sad. The Chamber of Commerce and Industry went further, calling for stamp duty to be abolished altogether. “We believe it should be replaced by a fairer broad-based replacement tax on the property’s gross rental value,” CCIWA head of policy Anthea Wesley said. “This would deliver more efficient housing and better social outcomes.” The HIA called for stamp duty to be scrapped for first homebuyers, or for the stamp duty-free threshold to be massively increased. “Maybe a $1 million threshold,” Mr McGowan said. He also called for stamp duty concessions for mid-rise developments in Perth’s inner-ring suburbs, and for downsizers looking to move. “There’s plenty of people in Leeming and Willetton and Rivervale with large properties that are looking to downsize,” Mr McGowan said. “Stamp duty continues to be a barrier, and the ability to free up the supply of those properties is something that we would certainly endorse, and given the financial windfalls of the State, is something that is worth trialling over the next 12 to 18 months.” A Real Estate Industry of WA 2025 Housing Issues Survey found stamp duty was a significant barrier to downsizing for 63 per cent of those surveyed, and 71 per cent backed further stamp duty concessions. Meanwhile, Property Council WA executive director Nicola Brischetto urged the Government to spend the unexpected windfall wisely to encourage development. “It seems only right that some of this windfall revenue should be reinvested into initiatives that boost housing supply,” she said. “These initiatives must target all sectors of the market, not just social and affordable options.” Treasurer Rita Saffioti wouldn’t rule any changes in or out, but has previously said it would be “far too difficult” to replace stamp duty with a land tax. “We are providing extra support for first home buyers by increasing the exemption and concession thresholds for stamp duty in the two most recent State Budgets,” she said on Friday. “We also looking to support first home buyers through our $210 million in shared equity loans through Keystart, as well as expanding Keystart’s loan eligibility for low deposit loans to assist more Western Australians into their own home.” Keystart is a WA government-owned company that provides home loans to assist people in buying their first home, requiring only low deposits and no lender’s mortgage insurance Shadow Treasurer Sandra Brewer accused Labor of banking the windfall while leaving Western Australians at the mercy of surging property prices. “They are neglecting to create the conditions for an affordable housing market,” she said. “Due to the government’s prioritisation of pet projects, housing supply is highly-constrained, sending prices up and stamp duties even higher. “The Government is completely out of touch with the housing crisis – their own budget forecasts only a 4.3 per cent rise in the median house price this year, despite having surged a staggering 42 per cent in just two years.”