First Home Buyer’s Grant GONE

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Premier Colin Barnett and Treasurer Mike Nahan deliver the 2014-2015 mid year review at Dumas House in West Perth. 22/12/14 Picture : Lincoln Baker/The West Australian. ***Fairfax Online/Financial Review Out***

WA Budget 2015: Housing and real estate

  • FHOG for established property axed
  • Grant unchanged at $10,000 new first homes
  • New ‘flatter’ land tax scale

First homebuyers wanting to buy an established property have been dealt a heavy blow in the 2015-16 budget, with the State Government removing the $3000 First Home Owners Grant.

It comes after the FHOG was reduced for established buyers from $7000 to $3000 in 2013.

The FHOG remains unchanged at $10,000 for those wanting to build their first home.

And stamp duty concessions for first home buyers of both new and established homes remain unchanged in this year’s budget.

Treasure Mike Nahan said the change was in line with the State Government’s policy objective of focusing financial support on residential construction.

Cutting the grant for first time buyers purchasing established homes will be a saving of about $109 million for the State Government over four years.

Grant loss fuel urban sprawl

REIWA president David Airey said the loss of the $3000 first home owners grant was a significant blow for first-homebuyers of established properties.

He said the construction of new homes had peaked in WA and it showed the government’s continued favouritism of the new homes market.

He said it would contribute to urban sprawl and property investors would be hit by the land tax increase.

I don’t believe the removal of the established first home buyer’s grant is going to make any noticeable difference to our local market. The issue of saving for a deposit aside, the difference $3000 makes to a home owners $430,000 mortgage is just $4 per week, based on current interest rates. However, as with all things real estate, fact is only part of the equation. Sentiment based on whatever the media deems important on any given day can have just as much influence on the behavior of buyers and sellers.

Wayne Heldt.

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