First home owner's grant

[Stan 101]

Only a goose tries to engage someone they've never met and have no idea of what they're dealing with.

No, I have a relatively good idea who I'm up against. Would you like me to elaborate? I have a feeling my profile of you would cut just a little too close to the bone. I only need to look at your post count and the amount of time you've been a member here to realise that.
The offer stands.

 

[kincella]

roe, we hang around here cause they also cater for a general forum...and in case you did not check there are 2 property threads been going on here for years...
oh and if there was more chatter on the dedicated property forums we would depart...quick just like that....
some do not even have one post per day....
unless you mean the houseprices gonna crash sites ??? where all the kids go to get their research papers...and waiting for their dreams to come true u know waiting for the 40-50% crash.....

 

[cooper1308]

Anyone looking to buy as a FHO, and hoping they cut the grant??

Surely it's just creating an artficial demand in which sooner or later it will catch up with everyone.....Those home buyers that were looking 3-4 years forward are coming to the market now, leaving a big buying gap down the track

 

[investorpaul]

Anyone looking to buy as a FHO, and hoping they cut the grant??

Surely it's just creating an artficial demand in which sooner or later it will catch up with everyone.....Those home buyers that were looking 3-4 years forward are coming to the market now, leaving a big buying gap down the track

I hope they cut the grant, although I will not be looking to buy for at least 12 to 18 months.

I believe any gov policy that involves subsidizing property purchases is flawed

 

[MrBurns]

From Crikey, looks like Vendors were the only ones to benefit from the KRudd bribe -

First home owners grant must go
Adam Schwab writes:


If the figures are to be believed, the Real Estate Industry of Victoria last week confirmed what Crikey has been saying since last October -- the first home buyer’s boost was the worst thing to ever happen to first home buyers. That is not to say that there have been no winners from the policy -- vendors and property developers (new properties receive upwards of a $21,000 grant) have certainly benefited. However, young and impressionable first home buyers, desperate tend to their own garden and stop paying rent have naively locked themselves into a significant, and in some cases potentially unserviceable, debt burdens.

The front page of the Sunday Age screamed, 'First Home Buyers Slugged', with Chris Vendelago noting that "house prices have risen by at least $7000 in more than half the lower-priced suburbs attractive to first home buyers since the grant was boosted in October from $7000 to $14,000 for existing homes, and to $21,000 for new houses. At the same time, house values fell elsewhere around the city, indicating that the grants have distorted the market for buyers struggling to afford their first home."


A closer look at the REIV data for the year ending 31 March 2009 poses a far more somber image than the recent data compiled by the RP Data-Rismark index last week. On a suburb-by-suburb basis, the effect of the first home owner's grant is profound. Median property price in Craigieburn rose by 21.6%, Lalor by 15%, Westmeadows by almost 18% and Broadmeadows by 12.8%. All 'affordable' suburbs, which recorded a median price of around $300,000. By contrast, Melbourne’s upper-end housing suffered a drastic fall -- Hawthorn East slumped by 36.7%, Albert Park was down 25.7%, Hampton fell 30% while Mentone witnessed a 32.7% drop in median prices for the year. While the sample size is questionable, these falls were not altogether indifferent to the scale of the equity market depreciation. So much for that old chestnut, 'property never drops in value'.


Despite the claims of property bulls there appears to be little other explanation for the pricing dualism other than the stunning effect of the FHOG. In reality, the FHOG would most likely inflate prices by more than its nominal value due to the effect of leverage – using a loan-to-valuation ratio of 90%, the grant’s boost gives a potential first home buyer $70,000 more to spend on their first home.


Overall, the REIV found that median house prices fell in Melbourne by 3.1%, this contrasts with the RP Data-Rismark index which claimed that Melbourne prices actually rose by 2.4% last year. Regardless of which measure is more accurate, the FHOG would have a significant effect on the 'median' prices of property. This is because far more properties fall within the 'affordable' range (which are able to benefit from the grant), causing the grant to have a strong effect on median prices. By contrast, the rarely quoted 'average' or mean property prices, which are too often affected by extreme values, would have been impacted far less by the grant.


In any event, it appears that the Federal Government are finally starting to realize that the cost (and negative effects) of the FHOG do not support its continuation beyond 30 June 2009. Prime Minister, Kevin Rudd, hinted that the boosted FHOG will not be extended past this financial year, claiming that "all good things must come to an end". Presumably, the 'good things' the PM was referring to were the additional profits earned by property developers (who also happen to be generous political donors), rather than the additional debt burden being assumed by young first home buyers. The Sunday Age’s James Kirby noted that the FHOG has completely failed to achieve its objectives, stating that "there's a recession on: unemployment is rising and lower-end house prices should be falling."


The entire FHOG principal is based on the flawed notion that higher property prices are better. In actual fact, there isn’t anything wrong with property prices falling. Unless you are forced to sell your property the actual value of the asset is not particularly relevant to the owner’s standard of living (and most people do not benefit when the price of an asset appreciates above its intrinsic value). Further, over-priced property serves as a de-facto tax on those who don't own the real estate (and who are eventually forced to pay vendor’s higher amounts to enter the property market). The quicker the Rudd Government removes the FHOG (and it should remove the grant entirely, not merely the boosted component) the better.

 

[ROE]

roe, we hang around here cause they also cater for a general forum...and in case you did not check there are 2 property threads been going on here for years...
oh and if there was more chatter on the dedicated property forums we would depart...quick just like that....
some do not even have one post per day....
unless you mean the houseprices gonna crash sites ??? where all the kids go to get their research papers...and waiting for their dreams to come true u know waiting for the 40-50% crash.....

I never said it going to crash by 40-50% I like to say it house price double every 7 years except it didn't go up this year or the year before and
the classic buy now before you are price out FOREVER

I have a crappy home which I don't own any money on it so if it's crash maybe I ask the banks pretty please lend me a few dollar to upgrade to a better property .. If not I just buy banks stocks

 

[ROE]

I hope they cut the grant, although I will not be looking to buy for at least 12 to 18 months.

I believe any gov policy that involves subsidizing property purchases is flawed

Never fear let value guide your way

The more they pump the harder it fall and the more fear and chaos will reign when thing fall apart

just like the stock market when it screaming pass the 6000 mark with borrowed money... I just drink coffee each day and watch it streaming past

...then suddenly this year I never bought stocks so cheap in Jan and Feb in my entire life ...much like the time I bought a property in 1998-1999

when people just accept any offer as most deal didn't go through

 

[ROE]

From Crikey, looks like Vendors were the only ones to benefit from the KRudd bribe -


The entire FHOG principal is based on the flawed notion that higher property prices are better. In actual fact, there isn’t anything wrong with property prices falling. Unless you are forced to sell your property the actual value of the asset is not particularly relevant to the owner’s standard of living (and most people do not benefit when the price of an asset appreciates above its intrinsic value)

take note of the word intrinsic value
intrinsic value is EVERYTHING in this world, business, stocks oh may not apply to housing cos they double every 7 years so out the door intrinsic value

 

[robots]

hello,

look at that:

http://www.news.com.au/heraldsun/story/0,21985,25438925-5005961,00.html

a return on investment,

i didnt realise the government owned all farmers, car makers, manufacturing plants, intellectual property/services etc etc

fantastic

thankyou
robots

 

[ROE]

hello,

look at that:

http://www.news.com.au/heraldsun/story/0,21985,25438925-5005961,00.html

a return on investment,

i didnt realise the government owned all farmers, car makers, manufacturing plants, intellectual property/services etc etc

fantastic

thankyou
robots

Great Success!!! as Borat would said it
Buy a couple more else you missed out on the next boom....I know I'm heading down to Victoria before 1st July and get one...

I can be sure I double my money 7 years from now ... My aim is 10 properties in 2 years then i can retire and living off equity while capitalise on my interest ... Life is BEAUTIFUL

 

[Mr J]

I can be sure I double my money 7 years from now

And then adjust results for inflation. Result? Break-even :.