# First Home Buyers Grant



## JoshyJ (7 November 2006)

Who believes it will be doubled? and how long do you reckon it will take for them to double it?

I was planning to buy an apartment but depends on the home buyers grant might wait, whats your views on this?


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## YChromozome (7 November 2006)

Its hard to know. I wouldn't wait on it, otherwise you could be waiting for ever.

Increasing the first home buyers grant does nothing to make the market more sustainable. All it does it fuels a all ready bloated bubble and gives people who can't afford housing $14,000 as a "deposit" to help them get further into trouble.

However an increase in the grant will be a good election sweater into the next election, should Interest rates continue to increase (which they will).


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## JoshyJ (7 November 2006)

Yeah I was only going to use the first home buyers grant to pay off more of the mortgage and reduce payments, so doesnt really matter much.


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## Marvin Martian (7 November 2006)

Makes little difference. After you pay stamp duty legal costs building inspections etc, you proabably just come out even. If anything I reckon the next governement will scrap it, cause houses will be cheap as ****.


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## wayneL (7 November 2006)

If it is doubled, I will be Marching on parliament house.
Y chromosone is dead right, and I hope Marvin will be proven correct also.

It's middle class briber...... ummm, I mean welfare; nothing more, nothing less.


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## JoshyJ (7 November 2006)

Marvin Martian said:
			
		

> Makes little difference. After you pay stamp duty legal costs building inspections etc, you proabably just come out even. If anything I reckon the next governement will scrap it, cause houses will be cheap as ****.




That's why you try and plan those stuff before hand  and have a budget for those said things. All it really is to me is just extra dough. You wouldnt want to get a house and then the very next day u find out u were able to get $7000 more for waiting one day.


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## Marvin Martian (7 November 2006)

JoshyJ said:
			
		

> That's why you try and plan those stuff before hand  and have a budget for those said things. All it really is to me is just extra dough. You wouldnt want to get a house and then the very next day u find out u were able to get $7000 more for waiting one day.



Um what do you mean? That I should save enough money to buy a place outright and get the grant on top of that?     Thank-you greedy  X and Y generation whatever you are lol


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## wayneL (7 November 2006)

Marvin Martian said:
			
		

> Um what do you mean? That I should save enough money to buy a place outright and get the grant on top of that?     Thank-you greedy  X and Y generation whatever you are lol



This is the great problem with all this crap. A whole generation has grown up, expecting a handout no matter whether it is needed or not... buy a house - get money, have a brat - get money, and so on.

What happens when the few remaining folks with a moral and social conscience just give up, and go on the take as well?

I see a major socionomic shift approaching... and it will not be comfortable.


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## krisbarry (7 November 2006)

I still think you are better off not bothering with the first home buyer grant for 4 reasons:

1st is to just rent out the home/unit as soon as you buy it.

2nd Renting in this current market of rising interest rates and crashing house prices seems like the wise move.

3rd Rent instead and the extra you save just deposit in your super fund and take advantage of the super co-contibution, that way after 5 years you have gained more than the $7000 for free.

4th Super funds/stock market, overall, are performing much better than the housing market


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## Marvin Martian (7 November 2006)

wayneL said:
			
		

> This is the great problem with all this crap. A whole generation has grown up, expecting a handout no matter whether it is needed or not... buy a house - get money, have a brat - get money, and so on.
> 
> What happens when the few remaining folks with a moral and social conscience just give up, and go on the take as well?
> 
> I see a major socionomic shift approaching... and it will not be comfortable.



I agree 100%.
 Ijiots today have no idea of what a recession is let alone a depression. Live in lala land and expect to pay the price. The unfortunate thing is they bring the rest of society down with them  
Smart people have been there, and know TIMING is everything.


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## 123enen (7 November 2006)

wayneL said:
			
		

> It's middle class briber...... ummm, I mean welfare; nothing more, nothing less.




The first home owners grant is neither bribery nor welfare.

The replacement of wholesale sales taxes with a 10 percent GST had a major impact on the total indirect tax take from the housing industry when it was introduced in July 2000.

The FHOG was introduced to compensate home owners for the introduction of GST. So while in isolation a $7,000 grant to first home buyers could have put pressure on prices, it was introduced at the same time as an average GST bill on the creation of a new home of around $12,000.

Perhaps to be fair the Govt. should have given this grant to everyone.

I wonder how many people that complain about this grant actually do a little bit of negative gearing on thier investment properties.


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## Marvin Martian (7 November 2006)

123enen said:
			
		

> The first home owners grant is neither bribery nor welfare.
> 
> The replacement of wholesale sales taxes with a 10 percent GST had a major impact on the total indirect tax take from the housing industry when it was introduced in July 2000.
> 
> ...



No more rental aasentance. That's fine.


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## clowboy (7 November 2006)

It's funny, when i bought my place i was looking at both established and ready built (ie near completion).  at the time I would have recieved 14k for the near completed one, which amazes me that it was over 10% of the PP.

Nowdays I think that would cover half the stamp duty


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## Smurf1976 (7 November 2006)

FACT: Housing is LESS affordable for first home buyers now than when interest rates hit 17% in the late 1980's.

As for solutions, there's not much chance of the government intentionally fixing the rampant inflation we've seen in recent times until it works its way through the entire economy. That process would seem to be well underway right now.

The RBA is going to be "fighting inflation" for years I expect. It is simply too far through the economy now to avoid the impact on retail prices once it all filters through.

What can the government do? There's not much chance of them dumping water on the fire, but at least they could stop throwing petrol around. Any rise in the first home owners grant being the worst possible news for first home buyers. All it means is more profits, or reduced losses, for the sellers and a higher price for the buyers. 

If we MUST hand out government money to first home buyers, then how about $3000 to put a solar hot water heater on the roof? It will actually save the home owner money whilst doing something worthwhile about climate change at the same time. That makes too much sense however...


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## wayneL (7 November 2006)

123enen said:
			
		

> The first home owners grant is neither bribery nor welfare.
> 
> The replacement of wholesale sales taxes with a 10 percent GST had a major impact on the total indirect tax take from the housing industry when it was introduced in July 2000.
> 
> ...




That may have been the stated intention, but either:

1/the money was misdirected
2/ *they lied*

I alway default to selection two on a statistical probability basis.  

Think about it. The GST only impacts on newly biult houses, yet the FHG was available on "second hand" houses as well. 

No! It was a pump priming measure designed to kickstart a lagging economy that is reliant on real estate and building, rather than production. It did that very successfully, however I still violently oppose the means.


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## 123enen (7 November 2006)

wayneL said:
			
		

> Think about it. The GST only impacts on newly biult houses, yet the FHG was available on "second hand" houses as well.




Changes in the sell prices of new properties eventually filter right through the property market. Sooner or later increases / decreases in sell prices of "existing" homes move up/ down  in similar proportion to sell prices of new homes.

Wayne, I think you would default to selection 2 even in the absence of statistical probability


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## wayneL (7 November 2006)

123enen said:
			
		

> Changes in the sell prices of new properties eventually filter right through the property market. Sooner or later increases / decreases in sell prices of "existing" homes move up/ down  in proportion to sell prices of new homes.




What of _de facto_ first time buyers. People who have been forced to start again because of misfortune, sickness, divorce, legal action etc?

What of them? They are now severely disadvantaged.


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## 123enen (7 November 2006)

wayneL said:
			
		

> What of _de facto_ first time buyers. People who have been forced to start again because of misfortune, sickness, divorce, legal action etc?
> 
> What of them? They are now severely disadvantaged.




Yes They are disadvantaged. Just like self funded retirees that do not get a pension.



Wayne, I think you would default to selection 2 even in the absence of statistical probability


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## Julia (7 November 2006)

Imo the biggest problem with the First Homeowners' Grant is that it's not means tested.  People should not be buying million dollar homes with it.

Other than that, I'm in favour of anything which encourages and assists home ownership.

Julia


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## 123enen (7 November 2006)

Julia said:
			
		

> Imo the biggest problem with the First Homeowners' Grant is that it's not means tested.  People should not be buying million dollar homes with it.
> 
> Other than that, I'm in favour of anything which encourages and assists home ownership.
> 
> Julia




Perhaps you may be better off capping the value of the first home for eligible persons rather than discriminating against some first home buyers.


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## JoshyJ (8 November 2006)

123enen said:
			
		

> Perhaps you may be better off capping the value of the first home for eligible persons rather than discriminating against some first home buyers.




I agree with capping the value of it. I also believe that first home buyers grant should not benefit owner/builders.


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## wayneL (8 November 2006)

123enen said:
			
		

> Wayne, I think you would default to selection 2 even in the absence of statistical probability



But it isn't.

I'm sure evreyone has heard these jokes:

Q: How do you tell when a politician is lying
A: When his/her mouth is moving

Q: Why is a politician like a banana
A: Because they all start off green and end up yellow and bent

Baboom!


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## krisbarry (8 November 2006)

Julia said:
			
		

> People should not be buying million dollar homes with it.
> 
> 
> Julia




This makes me laugh...what does a million dollars in the property market buy you these days...nothing!

A million dollar property in the suburbs is pretty much the average now days...you might want to up it to at least 2 or 3 million  

By the way, as a first home buyer (not), but I do qualify... I am happy with my $29.95 Kmart tent  

Does the first home buyers grant cover tents and park benches?


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## Marvin Martian (8 November 2006)

Stop_the_clock said:
			
		

> This makes me laugh...what does a million dollars in the property market buy you these days...nothing!
> 
> A million dollar property in the suburbs is pretty much the average now days...you might want to up it to at least 2 or 3 million
> 
> ...



Must be some tent if you still have internet.


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## wayneL (8 November 2006)

Marvin Martian said:
			
		

> Must be some tent if you still have internet.



It's the new trend in affordable housing! hah!


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## krisbarry (8 November 2006)

Marvin Martian said:
			
		

> Must be some tent if you still have internet.




Ever heard of wireless


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## krisbarry (8 November 2006)

wayneL said:
			
		

> It's the new trend in affordable housing! hah!




LOL, sad but very true.


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## pacer (8 November 2006)

Wayne...the trend is your friend....what is the biggest tent making stock...lol
Canvas makers are the new stocks to watch!


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## nizar (8 November 2006)

Julia said:
			
		

> Imo the biggest problem with the First Homeowners' Grant is that it's not means tested.  People should not be buying million dollar homes with it.
> 
> Other than that, I'm in favour of anything which encourages and assists home ownership.
> 
> Julia




So true.
Alot of rich people were picking up properties under their kid's name so they could make use of the grant, or not even using it for the house, but a nice vase instead!


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## krisbarry (8 November 2006)

I used to get quite angry about not being able to afford a house, but how things have changed. Nowdays I couldn't give a stuff, renting is certainly the way to go.

You can have your houses and your higher interest rates too.

LOL, another rate rise today  

I am going to get a cheap credit card today and rack it up with so much debt to keep inflation high, well into the new year

Anybody want a free Ipod or two...


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## Marvin Martian (8 November 2006)

Stop_the_clock said:
			
		

> I used to get quite angry about not being able to afford a house, but how things have changed. Nowdays I couldn't give a stuff, renting is certainly the way to go.
> 
> You can have your houses and your higher interest rates too.
> 
> ...




mmm
A friend rents a property and they have bumped the rent up twice in the last year quite considerably. I think the tent is a better option.


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## Buster (8 November 2006)

Stop_the_clock said:
			
		

> I used to get quite angry about not being able to afford a house, but how things have changed. Nowdays I couldn't give a stuff, renting is certainly the way to go.
> 
> You can have your houses and your higher interest rates too.
> 
> LOL, another rate rise today



Wow.. As with any business, costs are passed onto consumers.. Surely you don't believe the 'Higher Cost' of servicing the investment won't be passed on from the landlord to the tennent??

Sounds like your clock has already stopped..  

Regards,

Buster


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## Buster (8 November 2006)

Stop_the_clock said:
			
		

> This makes me laugh...what does a million dollars in the property market buy you these days...nothing!
> 
> A million dollar property in the suburbs is pretty much the average now days...you might want to up it to at least 2 or 3 million
> 
> ...



Not sure where you live 'Stop the Clock' (Planet Reebok perhaps..  ) but I live in the 'Boom' state that apparently will be more expensive than Sydney by Xmas..

I can tell you that a cool Million will buy you two or three *very* nice abodes in numerous suburbs.. and this place is truley 'God's Country'..  

Not that I'm interested in the Property Market over this way ATM.. There is bound to be tears soon..

Cheers,

Buster


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## Julia (8 November 2006)

Stop_the_clock said:
			
		

> This makes me laugh...what does a million dollars in the property market buy you these days...nothing!
> 
> A million dollar property in the suburbs is pretty much the average now days...you might want to up it to at least 2 or 3 million
> 
> ...



STC

I can't comment on what house prices are where you live, but I'd be very surprised if the average house in the suburbs costs $1M.  I would have thought such a fact would have been included when median prices for all the cities are published.

I don't particularly see the point in capping the value of house purchased under First Home Owners' grant.  What's to stop said purchaser immediately selling it and buying something more expensive (unless the grant is conditional on a defined period of residence).

If someone can afford to buy a $1M dollar home then I just don't see why they need the tax payer to contribute $7000 towards it.  

Lots more needy causes out there than using the money in that way.

But if you have a young family struggling to pay rent, and the $7000 will make the difference which will allow them to get into a very basic home and then meet the mortgage repayments instead of rent, then that seems to be really genuinely helpful.

Julia


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## Smurf1976 (9 November 2006)

Quote from a local real estate agent in the area my mother lives: "They (young couples) are accepting any offer they get, sometimes even in the 100's, because they just can't afford to keep the property".

Hmm... Houses in the area in question being typically $250K in recent times and they're having to accept offers below $200K in order to sell them. That's not a bull market... 

By the way, this is a perfectly normal middle income commuter suburb in Hobart, and quite a popular one at that.

Meanwhile, I note that the local Hobart "Real Estate Guide" is now a full 80 pages. Yep, the newspaper last Friday had 136 pages in it, 80 of which were nothing but houses for sale. Housing shortage? I don't think so, especially given the number of those properties for sale that are obviously empty.

And all this before the latest rate rise. But don't worry - "You can't lose with property" and this slide will never come to WA, just as it was never coming to Tasmania and was never going to start in Sydney.


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