Do Sellers Pay Stamp Duty in NSW? The Complete Answer

Transfer Duty (commonly known as stamp duty) in NSW is levied under the Duties Act 1997 (NSW) and is payable by the purchaser of real property. It is calculated as a percentage of the purchase price (or property value, whichever is greater) on a progressive scale.

The seller does not pay this. It is the buyer's obligation, payable at or before settlement. It is paid via your conveyancer's office from the buyer's funds and remitted to Revenue NSW simultaneously with the title transfer.

Even though sellers don't pay stamp duty, it materially affects the pool of buyers who can afford your property — and therefore affects demand, pricing, and days on market.

This is a significant liquidity requirement. Many otherwise qualified buyers — those who can comfortably service a $1.2M mortgage on their income — simply do not have $370,000 in accessible cash. Stamp duty is therefore a real barrier to entry that reduces the number of buyers who can practically transact at any given price point.

This is why changes to stamp duty — such as the NSW First Home Buyer Choice scheme, which allows eligible buyers to pay an annual property tax instead of upfront stamp duty — can meaningfully expand the buyer pool for certain property types and price ranges.

The NSW First Home Buyer Choice (FHBC) scheme, introduced in 2023, allows eligible first home buyers purchasing below a specified purchase price threshold to choose between:

Eligibility: As of 2024, the FHBC scheme applies to properties with a purchase price of up to $1.5M for houses and up to $800,000 for land only.

Impact on Sellers: For sellers of properties in the $800,000 to $1.5M range — particularly houses in middle-ring Sydney suburbs — the FHBC scheme has expanded the qualifying first home buyer pool by eliminating the large upfront cash requirement. A first home buyer who previously needed $60,000 to $70,000 in stamp duty savings (in addition to their deposit) can now transact with less upfront cash, making more buyers eligible.

Note: The scheme has been subject to legislative updates. Sellers should confirm current eligibility thresholds with their conveyancer, as the NSW Government has modified the scheme since its initial introduction.

While sellers don't pay stamp duty, understanding all of the costs a seller does face helps in financial planning:

Conveyancing Costs: $1,500 to $3,500 for a licensed conveyancer, or $2,500 to $5,000 for a solicitor, depending on complexity. This covers contract preparation, certificate searches, PEXA settlement execution, and mortgage discharge coordination.

Agent Commission (if using an agent): 1.5% to 2.5% of sale price plus GST. On a $1.8M property at 2%, this is $36,000 plus GST = $39,600.

Marketing Costs (if using an agent): Photography, staging, portal advertising: $5,000 to $20,000, payable upfront and non-refundable if the property fails to sell.

Mortgage Discharge Fee: Most lenders charge $150 to $400 to discharge a mortgage on settlement day.

Capital Gains Tax (if applicable): If the property is an investment property (not your primary residence), CGT may apply on the capital gain. See our Capital Gains Tax guide for full details.

Land Tax Clearance (if applicable): If you own NSW investment properties, any outstanding land tax debts on the sold property are cleared from settlement proceeds via a Revenue NSW clearance certificate.

For sellers using a private off-market sale with a direct buyer, the commission and marketing costs are eliminated entirely, reducing total transaction costs to conveyancing, discharge fees, and any applicable taxes.

Obtaining an objective valuation requires hiring a registered valuer certified by the Australian Property Institute (API). Registered valuers are governed under the Valuation of Land Act 1916 (NSW) and use housing database analysis alongside Direct Comparison valuations.

Unlike real estate agent appraisals (which are marketing estimates designed to win listings), API valuations are legally binding documents accepted by banks, courts, and the ATO.

Sourcing a certified valuation report provides a neutral baseline that protects executors, separating couples, and distressed sellers from disputes over property prices.

Registered API valuers assess several core variables to determine a property's market value. These include land size, topography, zoning permissions (LEPs), building construction style, internal layout efficiency, car parking availability, proximity to public transit nodes, and recent sales prices of comparable properties.

The valuer subtracts any allowance for structural defects or cosmetic repairs required, producing a fair valuation that serves as a neutral pricing baseline.