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Question about the First Home Buyers Grant

November 8, 2016

Mrs Armitage (Launceston) to the Leader of Government in the Legislative Council, the Honourable Dr Vanessa Goodwin -

 

On 15 August 2016 the Treasurer stated that the 2015-2016 Preliminary Outcomes Report showed that the Budget was back on track and was expected to be in the black for 2015- 2016 with an estimated surplus of over $60 million.

In view of this prediction will the Government:-

 

(1) Consider reinstating the First Home Buyers grant to remove the discrepancy between those first home buyers able to buy a new home who will receive a grant, and those first home owners who can afford to buy an existing home but are currently not eligible for a grant?

 

(2) Consider stamp duty exemption or concession for first home buyers purchasing an existing home who are not eligible for a first home buyers grant?

 

 

Answer from Dr Goodwin -

 

(1) and (2)

 

The First Home Owners Grant was initially introduced in 2000 to offset the impact of the introduction of the GST on the cost of buying or building a first home.

 

All jurisdictions have now targeted their First Home Owner Schemes to newly constructed housing.

 

The Tasmanian Government has committed to a targeted scheme that will not only assist first home buyers, but will also support employment in the building industry.

 

First home buyers in Tasmania are well served by the current First Home Owner Scheme, which provides a grant of $20 000 to first home buyers who build or buy a newly constructed home, backdated to I January 2016 until 30 June 2017.

 

The Reserve Bank's cash rate is at an all-time low of 1.5 per cent, which is of benefit to buyers of new and established homes.

 

Further, Tasmania continues to be the most affordable jurisdiction in Australia in which to buy a home (based on average weekly earnings and median house price in each capital city). Therefore, the need for further government assistance to first home buyers to enter the market is lower than in other states.

 

There is a range of evidence that shows funding to assist first home buyers who buy established homes tends to increase house prices both in the short- and long-term thereby benefiting the vendor or investor rather than the first home buyer.

 

Given this, there are no plans to reintroduce a grant for established homes or consider a stamp duty exemption or concession for first home buyers purchasing an existing home.

 

 

 

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