The NSW government announced on Tuesday that it will waive stamp duty for first-time home buyers buying houses under $ 650,000 from July 1, and implement a partial stamp duty reduction on newly purchased houses with a price of less than $ 800,000. Since the news was announced, all parties have expressed different opinions: Some people clapped and applauded, thinking that this is the Governor’s heavy blow to the affordability of the house since taking office in January; some experts worry that this move will only eventually push up housing prices.

Domain Group data scientist Nicola Powell said that although the median price for first-time home buyers in the Sydney area last year was $ 469,010, if supply is not increased, this price is likely to increase again due to tax incentives.

The government must consider supply issues. If financial incentives are now given to increase purchase enthusiasm, but there are no supply-side solutions, it is likely to cause an imbalance between supply and demand, thereby further increasing housing prices.

Corelogic data shows that in the past 12 months, 45.4% of homes in NSW sold for less than $ 650,000, and 58% for less than $ 800,000. But in the Sydney area, only 25.8% of the houses sold for less than $ 650,000 in the past year.

Realestate.com.au Director Andrew said that tax incentives make first-time home buyers and investors more competitive, but emphasized that the market still needs a multi-pronged approach