NSW recoups $9m from first home buyers caught ‘gaming the system’

The program was greatly expanded in the 2023–24 financial year, which saw the cap on maximum purchase price for a stamp duty exempt property increase from $650,000 to $800,000, while the threshold to receive a concession was lifted from $800,000 to $1 million. Successful applicants have to be making their first property purchase and are required to move into the home within a year, and subsequently occupy it for a full year.

Record numbers took advantage of the offer under the expansion, with a reported 33,365 first home buyers paying either no stamp duty or a discounted rate over the year.

But those who thought they could use the purchase as an investment property without the government catching on did not account for the state’s dedicated first home buyers compliance team, which apparently launched 718 targeted investigations over the year.

The team, which is part of Revenue NSW, matched the addresses of first home buyers against data collected from sources such as the NSW government Rental Bond Board, the Department of Home Affairs, and the Australian Taxation Office.

In some cases, tenants reportedly made tips, such as when a renter was asked to keep the landlord’s name on utility bills.

Ultimately, the compliance team determined that 422 recipients of the exemption or concession had failed their obligations to use the property as a primary residence, though the state noted this represents fewer than 1.3 per cent of all successful applications to the program.

NSW’s chief commissioner of state revenue, Scott Johnston, said he was proud of the compliance team for keeping the program fair.

“Revenue NSW’s compliance programs are essential to maintaining the integrity of our programs.

“Our team works tirelessly to make sure the first home buyers program is accessible to everyone who needs it, and that people who aren’t eligible don’t try to game the system.”

NSW Minister for Finance, Courtney Houssos, stressed that the eligibility criteria are important, as the scheme is meant to provide a leg-up on home buying for those who need it most.

“We want as many people as possible to access the scheme – but they have to stick to the rules. It keeps the program fair and accessible for everyone,” she said.