Following widespread media coverage of the now-reversed VAT hike, you may have missed a nugget of hope in Budget 2.0: Transfer duty threshold adjustments are set to provide much-needed relief for purchasers in the low to mid-range property market.
After a careful review of current tax tables, the monetary thresholds for transfer duty were recently adjusted upwards by 10% to counter inflation, as we previously reported. For practical purposes, this means that purchasing a property with an acquisition value of R1 210 000.00 or less will not attract the payment of transfer duty.
This threshold adjustment, which took effect on 1st April 2025, reduces the associated cost of purchasing property and ultimately expands the pool of prospective purchasers across various price ranges. For instance, a property with a purchase price of R1 800 000 will attract the payment of transfer duty in the amount of R21 786, which is R7 839 less than previous years.
This cost saving will be particularly appreciated by first-time homeowners who generally purchase property in the R700 000 to R1.5 million bracket, according to available data. With the average price for first-time purchasers at approximately R1.24 million, even more prospective buyers now fall below the exemption threshold, which ultimately reduces financial barriers to homeownership.
Naturally, the transfer duty adjustments, coupled with favourable lending conditions and the potential of another interest cut at the end of the month, may stimulate property investment and increase demand for low to mid-range properties. Indeed, lower transaction costs enhance affordability and generally attract new entrants to the property market.
To keep track of the impact of transfer duty adjustments on your property transaction, download our revolutionary STBB Direct mobile application. Perform a range of convenient cost calculations and track the progress of your matters directly from your mobile device. Download STBB Direct from the App Store or Google Play today!
For further information or to speak with one of our property law specialists, contact us at info@stbb.co.za and let us handle your property transaction – from start to finish.
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