Changes to First Home Bonus in budget

As the REIV reported all is not lost for first home buyers. The strong Victorian property market and a $303M increase in stamp duty receipts has helped ensure a healthy balance sheet for the State Government in 2009-2010. However at Changing Places we believe much more can be done.

REIV CEO Enzo Raimondo said the REIV welcomes increased grants for first home buyers of a new home and calls for urgent stamp duty reform to assist home buyers paying more than their fair share in stamp duty.

“Victoria has a 22,000 shortfall of homes and the increased First Home Bonus may help increase supply.

“Increasing supply is the key to making property price growth more sustainable; however the increased Bonus for new homes does little to help the other 70 per cent of new home buyers who buy existing dwellings.

“The fact that first home buyers of a new home will now receive $20,000 in Melbourne and $26,500 in regional Victoria will help thousands of young people exit the tight rental market and buy their first home. It is however disappointing that buyers of existing homes will see the assistance provided to them drop from $9,000 to $7,000 in 1 July.

“It appears that the removal of the $2,000 First Home Bonus for existing homes pays for the $2,000 increase for new homes.

“This measure will make it harder for 70 per cent of first home buyers and easier for 30 per cent.

With six children myself, and therefore reason for added concern, I see it just getting harder and harder for first home buyers to get into the market place. There is no doubt that Governments can do more to assist, as it is their taxes and economic policies that are putting home ownership out of reach of many.