The Cheapest State to Buy Is the Most Expensive to Hold: Stamp Duty vs Land Tax on a $700k House (2026–27)

Buy the same $700,000 house as an investor in the ACT and you'll pay $20,040 in stamp duty — the lowest of any state or territory in the country, and $17,030 less than you'd pay in Victoria. It looks like the cheapest place in Australia to buy. Then the land tax bill arrives: roughly $5,620 a year, the highest of the eight jurisdictions. Hold that property for a decade and the state that was cheapest to buy becomes, by a wide margin, the most expensive to own.

That inversion is the whole point of this piece. Buyers compare stamp duty because it's the number quoted at settlement. Almost nobody models land tax — the recurring charge that never appears on a listing — and on the same property the two can point in opposite directions. Below is the same $700,000 established house run through all eight states with Plintha's finance engine: exact transfer duty on one side, estimated annual land tax on the other, and what a ten-year hold does to the comparison.

Two government charges, pulling in opposite directions

Stamp duty (transfer duty) is a one-off. You pay it once, at settlement, on the purchase price. It is not deductible against your income along the way — it's a capital acquisition cost that goes into your CGT cost base, so you only "get it back" as a smaller taxable gain when you eventually sell.

Land tax is the opposite shape: an annual charge, levied on the unimproved land (site) value, that recurs every year you hold the property and rises as land values are reassessed. It's chiefly a cost of investment ownership — your own home is generally exempt — and, unlike stamp duty, it is generally deductible against your rental income each year.

One is a big number once; the other is a smaller number forever. Comparing states on the first alone is how a "cheap" purchase quietly turns expensive.

The same $700,000 house, all eight states

These are FY2026–27 general (investor) rates — no first-home or owner-occupier concession, no foreign-purchaser surcharge. Stamp duty is computed exactly by Plintha's engine against each revenue office's schedule (NSW's was re-checked after its 1 July 2026 re-indexing). Land tax is an estimate: it assumes a single property, general rates, and a site value of $455,000 — Plintha's default land estimate for a house (65% of price), flagged as an estimate because your real bill depends on the site value on your rates notice and any other land you hold in that state.

Land tax held flat at today's rate for ten years — a deliberate understatement, since site values are reassessed upward over time. Treat the ten-year figures as a conservative floor, not a forecast.

Read the table top to bottom by stamp duty and the order is one thing. Read it by the final column — what the two state charges actually cost you across a ten-year hold — and it reshuffles completely. The ACT falls from first to last. Queensland and New South Wales, middling on duty, come out cheapest overall because at this land value they levy no land tax at all. Victoria's headline duty is the steepest, but its modest land tax means it's not the most expensive state to hold in — the ACT is, by roughly $21,000 over the decade.

Everything else about this property is identical in every state: the same price, the same rent, the same loan and holding costs, the same pre-tax weekly top-up of about $406. The only things that move across the table are these two government charges — and they move enough to change which state is the "cheapest" depending entirely on how long you plan to hold.

Why the ACT is the outlier

The ACT isn't an accident or a quirk in the data — it's policy. The territory has spent years deliberately phasing stamp duty down while shifting the revenue onto annual land-based charges. That's why its duty on a $700,000 house is the lowest in the country and its land tax is the highest: it's the one jurisdiction that has openly chosen the recurring charge over the upfront one. For a short hold, that's a genuine advantage. For a long one, it's the most expensive combination in the table. The ACT is the clearest case of a rule that applies everywhere: the right "cheapest state" answer depends on your holding period.

The four zeros aren't permanent

New South Wales, Queensland, South Australia and the Northern Territory all show $0 land tax here — but for different reasons, and only one of them is durable.

• The NT levies no land tax at all, on any owner, at any value. That zero is real and permanent.
• NSW, QLD and SA show zero only because the estimated $455,000 land value sits under their tax-free thresholds — roughly $1,075,000 in NSW, $600,000 for an individual in QLD, and $936,000 in SA for 2026–27. That's a threshold, not an exemption.

Push the price up and the zeros start disappearing. On a $1,000,000 house — an estimated $650,000 of land — Queensland's land tax turns on (about $1,000 a year), Tasmania's climbs to roughly $3,988, and the ACT's reaches about $8,038. Land tax also aggregates: it's assessed on the combined value of all the land you hold in a state, so your second property in NSW or Queensland can push a portfolio over a threshold that each property individually sat under. The zero in the table is a single-property, this-price zero — not a promise.

The honest limits of this comparison

Two things this table does not claim to be. First, the land tax figures are estimates built on a land-value proxy; the duty figures are exact, but the land tax depends on the actual site value on your valuation notice and on what else you own in that state. Second, the ten-year land-tax column deliberately holds the rate flat — real site values are reassessed upward, so those figures understate the true recurring cost rather than overstate it.

And the two charges aren't quite comparable dollar-for-dollar, because the tax system treats them differently. Stamp duty is locked away in your CGT cost base and only reduces tax when you sell; land tax is deductible against rental income every year you pay it. A dollar of deductible land tax is worth more, after tax, than a dollar of non-deductible duty — which softens the recurring charge slightly, but doesn't reverse the direction of the comparison. If you want the mechanics, the land tax by state and stamp duty by state guides work through each, and why land value isn't the purchase price explains the estimate the land-tax figures rest on.

What to take from it

Stamp duty is the number that decides how much cash you need at settlement — it drives your deposit gap, your LMI position and your loan size, so it matters enormously on day one. But it's a one-off, and for a buy-and-hold investor the recurring charges are what compound. A state that looks cheap on the duty line can be the expensive one over the life of the hold, and a state with steep duty can be cheaper to own than it first appears. The only way to know which is which for a specific property — at its real price, its real land value, and your real holding period — is to run that property, not a rule of thumb.

You can do exactly that: run your own numbers on Plintha and it will price the exact duty for the property's state and estimate the land tax on its land value, alongside the yield, cashflow and stress test — the same figures behind this table.

This article is general information, not financial, tax or legal advice, and doesn't take into account your objectives or circumstances. Stamp-duty figures use FY2026–27 general (investor) rates; land-tax figures are estimates on a $455,000 assumed land value (65% of a $700,000 house) at single-property general rates, and your actual bill will differ with your real site value and other holdings. Confirm your own position with your state revenue office or a licensed adviser before acting.