The West Australian 10 Oct 2019 KIM MACDONALD
WA’s peak real estate lobby group is calling for the reintroduction of the $7000 first home owner grant in a bid to end WA’s longest property downturn in history.
The Real Estate Institute of WA called for the grant as part of a six-point plan to kickstart the market.
REIWA president Damian Collins said it was desperately needed as the number of first home buyers last year dropped to 14,757, its lowest level since 2011.
A report released yesterday said moves to boost the entrylevel sector would have flow-on effects in the trade-up market.
Stimulation was desperately needed after transaction levels across the board fell to 39,387 in 2018 — the lowest on record — compared to 89,000 in 2005.
Currently, only first home buyers building new homes get a grant, worth $10,000 for homes under $1 million. The $7000 grant for established property was reduced in 2013 and removed in 2015. But entry-level buyers have a clear preference for existing homes, with almost 60 per cent opting for that type of property over newly-built houses, which are mostly in outer suburbs.
Mr Collins said the Government’s policy to give the grant only to those who build was promoting urban sprawl.
“Why are they encouraging people to buy a new block on the outskirts when their own policy is for urban infill?” he said.
“There needs to be an alignment of policies.”
Mr Collins said those who bought in established areas reduced the burden on the Government to provide infrastructure in the outer suburbs.
“It is unfair that these first home owners are penalised for making a decision that is financially better for the State,” he said. The plan also calls for an increase to the stamp duty exemption threshold for entry buyers from $430,000 to $550,000.
REIWA also wants the Government to review tax, introduce a $10,000 concession on stamp duty for downsizing seniors, remove stamp duty for off-the-plan purchases and end the foreign owner duty. WA Treasurer Ben Wyatt said he would consider REIWA’s demands during the budgetary process but warned the State was restrained by high levels of inherited debt.
“I would be very supportive of the Federal Government to follow the advice of the Reserve Bank of Australia and take some immediate action in what is clearly a national problem,” Mr Wyatt said. The property downturn of the past five years is the longest downturn since records began in the 1980s.
This article by Kim Macdonald and was originally published in The West Australian Click here to read the original article.