Stamp duty is the cost that catches a lot of first home buyers off guard. On an $800,000 home in NSW, standard transfer duty is roughly $31,000. That's money you'd otherwise need on top of your deposit, in cash, at settlement.
The good news is that most first home buyers in NSW pay a lot less, or nothing at all, thanks to the First Home Buyers Assistance Scheme (FHBAS).
The thresholds
For contracts signed now, the scheme works like this:
Homes (new or existing) - Up to $800,000: no transfer duty - $800,000 to $1,000,000: concessional (reduced) duty - Over $1,000,000: full duty
Vacant land you'll build a home on - Up to $350,000: no transfer duty - $350,000 to $450,000: concessional duty - Over $450,000: full duty
The concession tapers, so a home at $850,000 pays far less than one at $990,000. Revenue NSW has a calculator on its website, and we run the numbers for every client before they bid.
Who qualifies
The broad rules are:
- At least one buyer is an Australian citizen or permanent resident
- You're 18 or older
- Neither you nor your spouse has owned or co-owned residential property in Australia before
- You move in within 12 months and live there for at least 6 continuous months
If you buy with someone who isn't a first home buyer, the rules get more complex. Usually the concession is reduced or lost. Get advice before you sign.
A quick example
Priya and Tom buy their first home in Penrith for $780,000. Under FHBAS they pay $0 in transfer duty. Without it, duty would be roughly $30,000.
That $30,000 stays in their pocket. They could put it towards their deposit, keep it as a buffer in an offset account, or simply need less savings to buy sooner.
Now say they find a place for $920,000 instead. They still get a concession, but they'll pay part of the duty. The extra $140,000 in price costs them more than just the loan difference, which is worth knowing when you're deciding how high to go at auction.
What about the First Home Owner Grant?
The NSW First Home Owner Grant is a separate $10,000 payment for buying or building a new home. The caps are $600,000 for a new home purchase, or $750,000 for land and a new build combined. Read the full breakdown in First Home Owner Grant NSW.
You can get both the grant and the stamp duty exemption on the same purchase if you meet both sets of rules.
Using it with the 5% Deposit Scheme
This is where it gets powerful. A first home buyer in NSW can often combine:
- The 5% Deposit Scheme (5% deposit, no LMI)
- FHBAS (no stamp duty up to $800,000)
- The First Home Super Saver scheme (up to $50,000 from super per person)
On a $780,000 home, that could mean buying with around $39,000 deposit plus legal and inspection costs, with no LMI and no stamp duty. A few years ago, the same purchase would have needed $156,000 for a 20% deposit plus $30,000 in duty.
Mistakes we see
Bidding just over a threshold. Going from $799,000 to $805,000 adds the price difference plus a slice of duty. Know where the thresholds sit before auction day.
Missing the residence rules. If you don't move in within 12 months, or you rent it out within 6 months, Revenue NSW can ask for the duty back with interest.
Assuming your partner's history doesn't matter. If your spouse has owned property before, even if they're not on the new title, it can affect eligibility.
Forgetting other upfront costs. Conveyancing, building and pest inspections, loan fees and moving costs still add up. Budget at least a few thousand dollars.
The property tax option is gone
From 2023 there was a brief option to pay an annual property tax instead of duty. That option was closed by the NSW Government in mid-2023, so FHBAS is now the main path for first home buyers.
Frequently asked questions
Do I get the exemption if I'm buying with my parents?
Your parents would usually not be first home buyers, which affects the concession. A family guarantee, where parents guarantee part of your loan without going on title, is often a better structure.
Does the exemption apply to off-the-plan apartments?
Yes, if the price is within the thresholds and you meet the residence requirements once it's built.
Where do I apply?
Your conveyancer or solicitor usually applies for you through Revenue NSW when the transfer is stamped.
Not sure how much duty you'll pay or how high to bid? Call Finfident on 0424 545 654 and we'll map out your total upfront costs before you start looking.
This article is general information only and doesn't take into account your objectives, financial situation or needs. Figures, rates and scheme rules are current as at October 2026 and can change. Finfident Finance Brokers (ABN 94 679 280 801) is Credit Representative 569374 of Outsource Financial Pty Ltd (ACN 131 090 705), Australian Credit Licence 384324.