Stamp duty is one of the largest upfront costs when buying property in Victoria, often running into tens of thousands of dollars. Yet many buyers are surprised by exactly how much they’ll need to pay, and when. Understanding how stamp duty works, what exemptions and concessions are available, and how to minimise your liability can save you significant money. At Mortgage & Finance Advisory, we help property buyers across Geelong, the Surf Coast, Melbourne, and regional Victoria plan for stamp duty as part of their overall purchase strategy.
This comprehensive guide covers everything you need to know about stamp duty in Victoria for 2026, including the current rates, exemptions for first home buyers, off-the-plan concessions, the foreign purchaser surcharge, and practical strategies for reducing your stamp duty bill.
Stamp duty (officially called land transfer duty in Victoria) is a state government tax charged on property purchases. It’s calculated as a percentage of the property’s purchase price (or market value, whichever is higher) and must be paid to the State Revenue Office (SRO) Victoria. The revenue is used to fund state services including infrastructure, health, and education.
Unlike council rates or land tax, stamp duty is a one-off payment made at the time of purchase. It’s separate from your mortgage and usually needs to be paid from your own savings (though some lenders will allow it to be added to the loan in certain circumstances, typically increasing your LVR and potentially triggering lenders mortgage insurance).
Victoria uses a sliding scale for stamp duty, meaning different portions of the property value are taxed at different rates. The more expensive the property, the higher the effective percentage you’ll pay.
| Property Value | Duty Rate |
|---|---|
| $0 to $25,000 | 1.4% of the property value |
| $25,001 to $130,000 | $350 + 2.4% of amount over $25,000 |
| $130,001 to $440,000 | $2,870 + 5% of amount over $130,000 |
| $440,001 to $550,000 | $18,370 + 6% of amount over $440,000 |
| $550,001 to $960,000 | $28,070 + 6% of amount over $550,000 |
| Over $960,000 | 5.5% of the total property value |
| Over $2,000,000 (premium duty) | 6.5% of the total property value |
| Purchase Price | Stamp Duty Payable | Effective Rate |
|---|---|---|
| $500,000 | $21,970 | 4.39% |
| $650,000 | $34,070 | 5.24% |
| $800,000 | $43,070 | 5.38% |
| $1,000,000 | $55,000 | 5.50% |
| $1,500,000 | $82,500 | 5.50% |
Victoria offers generous stamp duty relief for eligible first home buyers, making it one of the more affordable states for getting into the property market.
First home buyers purchasing a property valued at $600,000 or less pay zero stamp duty. This applies to both new and established homes, as long as you meet the eligibility criteria. On a $600,000 property, this saves you $31,070, a significant amount that could instead go toward your deposit or mortgage offset account.
For properties valued between $600,001 and $750,000, a sliding scale concession applies. The concession reduces as the property value approaches $750,000. For example, a first home buyer purchasing at $675,000 would pay substantially less than the standard duty amount, while a purchase at $749,000 would receive only a minimal concession.
To qualify for the first home buyer stamp duty exemption or concession, you must be purchasing your first home in Australia (never having owned or co-owned residential property anywhere in the country), be an Australian citizen or permanent resident, be aged 18 or over, move into the property as your principal place of residence within 12 months of settlement, and live in the property for a continuous period of at least 12 months.
If you’re buying with another person, at least one of you must be a first home buyer, and the concession applies proportionally to the first home buyer’s share.
One of the most significant stamp duty savings available in Victoria comes from purchasing off-the-plan apartments or townhouses. Under this concession, you pay stamp duty on the land value only, not the combined land and building value. Since the building component typically represents 40-70% of the total purchase price, the savings can be substantial.
A couple buying a $550,000 off-the-plan apartment in Geelong where the land component was valued at $220,000 paid stamp duty on just the $220,000 land value: approximately $7,370 instead of the $28,070 they would have paid on the full purchase price. That’s a saving of over $20,000. Combined with the first home buyer exemption (as the land value was under $600,000), they actually paid zero stamp duty on a $550,000 property. We helped them structure their loan to maximise these savings from the outset.
Foreign purchasers (non-Australian citizens who are not permanent residents) must pay an additional 8% surcharge on top of the standard stamp duty rates. This applies to all residential property purchases in Victoria. On a $750,000 property, the foreign purchaser surcharge alone would be $60,000, on top of approximately $40,000 in standard stamp duty, a total of around $100,000.
Temporary residents who later become permanent residents may be eligible for a refund of the surcharge, subject to meeting specific conditions and time limits.
Eligible pensioners (holders of a Pensioner Concession Card or Department of Veterans’ Affairs Gold Card) may qualify for a stamp duty exemption or concession when purchasing their principal place of residence. The exemption applies to properties valued up to a certain threshold, and a concession applies on a sliding scale for properties above that threshold. This benefit is only available once, and the purchaser must live in the property as their main home.
Stamp duty must be paid to the State Revenue Office (SRO) within 30 days of settlement (or 30 days of the contract becoming unconditional in some cases). In practice, your conveyancer or solicitor handles this payment as part of the settlement process. They’ll calculate the exact amount, submit the necessary forms, and arrange payment from funds you provide.
You need to have the stamp duty funds available at settlement. Most buyers pay stamp duty from their cash savings separately from their home loan. Some lenders will allow stamp duty to be capitalised (added to the loan), but this increases your loan amount, pushes up your LVR, and may trigger LMI that wouldn’t otherwise apply. It also means you’re paying interest on the stamp duty for the entire life of the loan, turning a $30,000 stamp duty bill into $50,000+ over a 30-year mortgage.
While stamp duty is a government-set tax that can’t be negotiated, there are legitimate strategies to minimise your liability.
Buy below the first home buyer threshold: If you’re a first home buyer looking at properties around the $600,000 to $750,000 range, buying at or below $600,000 means zero stamp duty rather than a partial concession. Even a property at $599,000 versus $601,000 could save you several thousand dollars.
Consider off-the-plan purchases: The duty-on-land-only concession for off-the-plan properties can save tens of thousands. If you’re open to buying a new apartment or townhouse, this concession makes a significant difference to your upfront costs.
Negotiate on the property price: Since stamp duty is calculated on the purchase price, every dollar you negotiate off the price reduces your stamp duty proportionally. Saving $20,000 on the purchase price of a $700,000 property reduces your stamp duty by approximately $1,200 as well.
Buy the property in the right entity: For investment properties, the entity you use (personal name, company, trust) can affect the duty payable, particularly if there’s a foreign purchaser involved. Get advice before signing a contract.
Check for vacant residential land tax implications: Victoria also charges an annual vacant residential land tax on properties left unoccupied. If you’re buying an investment property, factor this into your overall cost calculations.
Victoria has been progressively increasing its annual land tax while maintaining stamp duty. Unlike stamp duty (a one-off payment), land tax is charged annually on the total taxable value of all land you own (excluding your principal residence). For investors, both stamp duty and land tax need to be factored into the purchase decision. The land tax-free threshold in Victoria has been declining, meaning more property owners are now paying both stamp duty at purchase and ongoing annual land tax.
While stamp duty is generally unavoidable, there are legitimate strategies to minimise your liability. Timing your purchase strategically can make a significant difference. If the Victorian government announces concession changes in a budget, settling before or after the effective date could save thousands. Additionally, buying property as a principal place of residence rather than an investment attracts substantially lower duty rates, and first home buyers benefit from the most generous concessions available.
Another strategy gaining popularity in Geelong and Melbourne is purchasing off-the-plan properties. When you buy off-the-plan, stamp duty is calculated on the land value at the time of the contract rather than the completed property value. For a $700,000 off-the-plan apartment where the land component is valued at $350,000, your stamp duty would be calculated on $350,000 rather than the full purchase price, potentially saving $15,000 or more. This concession applies to both owner-occupiers and investors, making it a useful planning tool.
Client Example: Off-the-Plan Stamp Duty Savings
A young couple purchasing an off-the-plan townhouse in Armstrong Creek for $620,000 saved significantly on stamp duty. The land component was valued at $280,000 at the contract date. Instead of paying stamp duty on $620,000 (approximately $33,070), they paid duty on $280,000 ($11,760), a saving of over $21,000. Combined with the first home buyer duty reduction, their total stamp duty liability was reduced to just $2,870. We helped them factor these savings into their borrowing strategy, reducing the overall funds required at settlement.
Foreign purchasers of Victorian property face an additional surcharge on top of standard stamp duty rates. As of 2026, the foreign purchaser additional duty is 8% of the dutiable value, a significant cost that must be factored into any property purchase by non-residents or temporary visa holders. This surcharge applies to residential property only and is in addition to, not instead of, the standard stamp duty calculation.
There are also additional duties that can apply in specific circumstances. Transfers between related parties (such as adding a spouse to the title) may trigger duty at market value rather than the transfer price. Property transfers as part of a relationship breakdown are generally exempt, but the exemption requires specific documentation. Deceased estate transfers to beneficiaries are typically exempt from duty, but subsequent sales by the estate attract standard rates. Corporate and trust transactions involving property also have their own duty rules that can be complex, particularly when the entity holds Victorian land above certain thresholds.
Stamp duty has a direct impact on how much you can borrow because it increases the total funds required to complete your purchase. Lenders do not finance stamp duty costs within the property loan itself (with very limited exceptions), meaning you need to have these funds available from savings or equity. For a $750,000 property in Victoria, stamp duty of approximately $41,070 plus legal fees, inspections, and other costs means you may need $80,000 or more above your deposit, a substantial sum that affects your deposit position and potentially your loan-to-value ratio.
For investors purchasing additional properties, stamp duty costs compound quickly. A portfolio of three investment properties valued at $600,000 each would incur approximately $94,000 in total stamp duty across all purchases. This is why equity release strategies become so important for property investors: accessing equity from existing properties to cover stamp duty and deposits on new acquisitions without depleting cash reserves. At Mortgage & Finance Advisory, we calculate the full cost of purchase including stamp duty when assessing your borrowing capacity, ensuring there are no surprises at settlement time.
Some lenders allow you to capitalise stamp duty into your mortgage, but it’s generally not recommended. It increases your total loan amount, may push your LVR above 80% (triggering LMI), and means you’ll pay interest on the stamp duty for up to 30 years. On a $30,000 stamp duty bill added to a 30-year mortgage at 6%, you’d pay approximately $34,700 in additional interest over the life of the loan.
Transfers of property as part of a deceased estate are generally exempt from stamp duty in Victoria. However, if you subsequently sell the property and buy another, stamp duty applies to the new purchase in the normal way.
Transfers of the principal place of residence between spouses or domestic partners are exempt from stamp duty in Victoria. However, transfers of investment properties between spouses are not exempt and attract standard duty rates.
If the contract of sale is rescinded or terminated (not just varied), you can apply for a refund of stamp duty paid. The SRO processes refund applications, and your conveyancer can assist with the paperwork. Refunds typically take several weeks to process.
Yes, commercial property purchases in Victoria also attract stamp duty, generally at the same rates as residential property. However, commercial properties don’t benefit from first home buyer exemptions. GST may also apply to commercial property purchases, which interacts with the stamp duty calculation.
State governments regularly review stamp duty settings. There has been ongoing discussion about potentially replacing stamp duty with a broader land tax, as the ACT has been progressively doing. Any changes would be announced through the Victorian budget process. We recommend checking the SRO website or speaking with us for the most current information when you’re preparing to purchase.
We help you factor stamp duty into your total purchase budget and identify every exemption and concession you’re eligible for. Get a complete cost picture before you buy.
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About the Author
Melanie McNaughton is the founder of Mortgage & Finance Advisory, helping property buyers across Geelong, the Surf Coast, Melbourne, and regional Victoria navigate the costs and complexities of purchasing property. With deep knowledge of Victorian stamp duty rules and first home buyer concessions, Melanie ensures every client understands their full purchase costs before signing a contract.
Director & Senior Finance Broker
With years of experience in mortgage broking and finance, Melanie helps clients across Geelong, the Surf Coast, Melbourne and regional Victoria navigate the complexities of home loans and business finance. Contact our team on 03 9020 2699.
