|Page tools: Print Page Print All RSS Search this Product|
Feature article: Changes to volume measures of ownership transfer costs
Assets other than land, buildings and dwellings may also incur ownership transfer costs, but these are included in the asset category to which they were connected. For example, an installation service on a piece of machinery or equipment would be included in the machinery and equipment category of GFCF.
Revisions to 2018-19 ASNA
In the 2018-19 ASNA, the volume measures of ownership transfer costs related to real estate fees, legal fees and government transfer are aligned to the number of title transfers. This replaces the previous methodology of using price deflation, resulting in revisions from 2010-11 onwards. The volume estimates of stamp duties has been aligned to the number of title transfers on land, buildings and dwellings adjusted for exemptions provided to some first home buyers from paying stamp duty.
The revisions to GFCF for ownership transfer costs chain volumes are shown in Figure 1. The chain volume of ownership transfer costs was revised from 0.1%, down to -5.4% in 2017-18. This downward revision is mainly due to new policies introduced in Victoria, Queensland and New South Wales from 1 July 2017, which exempts first home buyers from paying stamp duty on properties valued below $600,000 in Victoria and $550,000 in Queensland and New South Wales, significantly reducing the number of title transfers in these States that incur stamp duty.
Figure 1: Chain volume measures of GFCF ownership transfer costs
Rationale for change to deflator estimates
High quality chain volume estimates of ownership transfer costs require each component to be deflated using an appropriate price index or that the current price for ownership transfer costs are revalued using a relevant quantity indicator.
The number of title transfers as reported through administrative data from each state office is a good indicator of the quantity of services provided by intermediaries (e.g. real estate agents, legal professionals and the government). The assumption is that the vast majority of land, dwellings and buildings are transacted through agents and attract the associated fees.
The volume of stamp duties is more complex and accounts for a significant proportion of ownership transfer costs. Taxes on products such as stamp duties should be aligned to the size of the tax base and therefore only includes those title transfers that attract stamp duty.
In the 2018-19 ASNA, improvements have been made to the chain volumes estimates of GFCF for ownership transfer costs which was introduced revisions from 2010-11 onwards.
More information on the estimation of ownership transfer costs can be found in chapter 10 of Australian System of National Accounts: Concepts, Sources and Methods (cat. no. 5216.0).
These documents will be presented in a new window.