A proposal to waive stamp duty for more first home buyers in NSW has been criticised for not applying to the average home on Sydney's outskirts.
Labor on Monday said it would expand the existing government program that offers full or partial rebates on new or existing properties for first home buyers.
House prices across Sydney are predicted to drop by 12 per cent in the coming year but the number of approvals for first home buyers has halved over the last two years, Opposition leader Chris Minns said.
"Now's the right time to put this policy in place so that new market entrants have access to the housing market," he told reporters on Monday.
The existing government program waives stamp duty on new homes valued up to $800,000 and existing homes up to $650,000.
Under Labor's proposal, the $800,000 cap would apply to all homes.
Stamp duty would be partly waived on homes worth up to $1 million, an increase on the current limit of $800,000.
"If Labor is elected, 95 per cent of first home buyers will pay no stamp duty at all, or a reduced amount," Minns said.
Parliamentary Budget Office modelling estimates more than 46,000 people - 95 per cent of all first home buyers - would be able to access full or partial waivers under the expanded scheme, costing $733m over the first three years.
An estimated 30,000 to 46,000 people get relief under the existing program.
Treasurer Matt Kean said Labor's scheme won't apply to the median house in suburbs on Sydney's outskirts.
"The median home price in Oran Park and Marsden Park is already above the $1 million threshold that Labor's set," he said.
Home ownership has become an election issue ahead of the NSW ballot in March.
Premier Dominic Perrottet, keen to completely phase out stamp duty and replace it with an annual land tax, passed laws in November to offer first home buyers a choice between the two schemes for a property bought for up to $1.5 million.
The tax due on land worth $500,000 would be $3000 per year - compared to a one-off stamp duty payment in the tens of thousands of dollars.
Labor has pledged to repeal that if elected.
"The only thing worse than stamp duties is an annual land tax on the family home forever," Mr Minns said.
The Greens called Labor's policy "tinkering around the edges" and promised to push the next government to invest more in public, social and affordable housing and tax high-value properties and investment portfolios.
"(Labor's policy) is so far from the massive reforms we need to address housing affordability," Greens MP Jenny Leong said.
