First Home Owner Grant boost ending?

[Andrew from Vista Financial]

This has been released today.

 

Prime Minister Kevin Rudd has signalled that the increased first home owner's grant will not be extended beyond June 30.

The government has been under pressure to signal whether it will extend the boost to the grant, but has so far refused to outline its plans.

"The first home owner's boost, as you know, we have indicated that will conclude within a very fixed and finite time frame," Mr Rudd told reporters in Perth.

"It's had strong useful results so far, but I have got to say all good things must come to an end."

The grant was raised from $7,000 to $14,000 for existing dwellings and from $14,000 to $21,000 for new homes as part of the government's $10.4 billion stimulus package last year.

Mr Rudd said the government was still measuring the full effects of the boost but it was important the community understood deadlines were imposed for a particular purpose.

The increased grant, compbined with low interest rates, has seen first home buyers flooding the property market, but it has also fuelled concerns that the demand may be creating a debt bubble that could burst as unemployment rises.

"The last thing anyone wants to see is a repeat of the US sub-prime problem," said Craig James, chief economist at CommSec after the release of home sales data. "Perhaps a revamped grant could see the Government matching real savings contributed by first home buyers."

The government claimed late last month that more than 12,500 Australians are taking up the increased grant per month.

"A strong housing market is critical for underpinning confidence and supporting jobs in the Australian economy," Housing Minister Tanya Plibersek said.

[andy and lindsey]

Andrew just as a matter of interest what do you have to have done prior to the end of June in order to get ther first home owners grant is it just a matter of signing contract with builder? Not for us - we got the 7k, interested for some friends!

[Andrew from Vista Financial]

Hi Andy & Lindsey

 

Hope you are all well.

 

Yes to qualify for the extra boost grant, building contracts need to be signed before the end of June.

 

Very suprised that they are looking at stopping it though, thought they would continue especially with what's happening with the economy etc.

 

Andy

[HEAPS GOOD !!!]

I have heard a rumour that in a bid to keep ppl buying property/land that the SA Government might put freeze on stamp duty...this is only a rumour that is goin around work.

 

We will have to wait and see....were waiting for an answer about our mortgage, the banks are getting very tight with lending money right now.

[Guest sjs]

Andrew - thanks for that once again - you always have the important/useful information!

 

That statement just keeps us all guessing really though - doesnt it?

 

On one hand they say its got to come to an end - dont want to encourage people getting mortgages when unemployment is rising though on the other hand it is important for the economy to have a stable housing market.

 

I thought it would be extended too as did some mortgage advisors I have spoken to - they were quite confident of it in fact. However we shall see.

[Guest Trakki]

Was hoping it would stay but we have decided not to buy until we sell our house in UK now which will be at least 2 years now. Oh well there may be something elase around by then. Thanks for the info Andrew.