‘You can’t smell a mortgage’: Domain boss turns focus to home loans, pressures governments for stamp duty reform

Domain boss Jason Pellegrino is urging state governments to review taxes that make it difficult to enter the housing market as he flagged ambitions to invest heavily in the company’s home loans division.

Pellegrino said local and state governments should invest more in understanding what type of housing is in demand, but conceded there would be single-digit decline in residential real-estate listings over the next financial year amid forecasts house prices could fall as much as 20 per cent.

“Housing affordability… continues to be an issue and whilst prices are declining, price declines alone are not going to solve that issue,” Pellegrino said. “There is a range of issues that I think from a government perspective we need to step on… rather than sort of noting the problem and then putting it in the too-hard basket.

“We have to help with demand and help people into the market with government support and the like, but we also have to remove friction costs. The current structure of that cost puts an upfront penalty and impedes the transaction in that market.”

This is not the first time Pellegrino has pushed for the removal of stamp duty. He said in February there “needs to be political will” to move forward with reform. NSW announced in June it would follow the ACT in a switch from stamp duty to land tax.

“We’ve done some research that says that your average new home buyer, for example, a couple with two incomes, takes several years to actually save the money to pay for stamp duty and so that slows down the entire system,” Pellegrino said.

“[Stamp duty] also slows down the entire system on the way out, so people who are looking to downsize delay that decision and stop that property being made available for people who want to buy into it.”

The comments came after the release of the real-estate listing portal’s fiscal year 2022 results. Revenue rose 23.2 per cent to $356.7 million and net profit after tax increased slightly to $35.1 million. Earnings [before interest, tax, depreciation and amortisation] grew 21.4 per cent to $122.1 million, and the company will pay a full-year dividend of 4cents next month.

Domain said it expected costs – excluding acquisitions – to increase in the low double-digital range from the 2022 financial year base of $226.7 million. Nine Entertainment Co, the owner of this masthead, has a 60 per cent stake in Domain.