Residents Callum and Karis Bensemann said the extra money paid on stamp duty will go towards their renovations.

"Initially it seemed impossible and so far out of reach, but a few things happened in our journey that led us to get our foot in the door and purchase our first home," Mr Bensemann said.

"We have a lot of other close friends and family who will 100 per cent benefit from this stamp duty."

The Stamping Out Stamp Duty initiative will use the income from a proposed short stay levy to abolish stamp duty for Tasmanians buying their first home, saving them thousands.

Eligible Tasmanians will not pay a cent of the stamp duty for any home valued up to $750,000, and save up to $28,935.

The state government's $30,000 First Home Owner grant will be reduced to $10,000 from July 1, and state Treasurer Michael Ferguson said it would work in conjunction with the stamp duty initiative.

"We think this is a great way to go forward, and 100 per cent consistent with out election statements," Mr Ferguson said.

"House prices have increased and one thing that the state government is able to do is this policy stamping out stamp duty.

"We'll be right into parliament to introduce these changes and backdate it to February 18."

He said the stamp duty plan existed for houses, units and apartments, and would begin immediately for two years until June 30, 2026.

Independent MHA David O'Byrne has previously advocated for a 15 per cent levy on short-stay accommodation, with revenues directed to homeless services and facilities.

Premier Jeremy Rockliff acknowledged Mr O'Byrne's policy initiative.

"We've got our very clear policy commitment as part of our 2030 Strong Plan for Tasmania's future around the Airbnb Levy," Mr Rockliff said.

"We recognise that we have to be very sensible and prudent when it comes to investing Tasmanian taxpayers resources, and we will do so."