REIWA WANTS HOMES GRANT BACK
REIWA is calling on the State Government to reinstate the established homes grant as fresh data shows new builds have overtaken established home purchases.
In May, established homes represented 46 per cent of first-home buyer purchases, according to the industry body’s figures.
This could fall further in June, with Housing Industry Association data released recently showing newly built homes increased 21.1 per cent in the month as first-time buyers scrambled to qualify for the $5000 First Home Owners Grant (FHOG) pay- ment boost before it ended on June 30.
The FHOG was $7000 for new builds and established homes when it was introduced in 2000.
REIWA data shows from then until 2013, when the grant for established homes was cut to $3000, established purchases represented 72 per cent of total transactions on average.
Before the established homes grant was removed in late 2015, established purchases had fallen to about 55 per cent of transactions.
New builds, which can receive a FHOG payment up to $10,000, have overtaken established purchases several times in the past 18 months.
REIWA president Hayden Groves (left) said the institute’s data clearly showed abolishing the FHOG for established properties had affected the established homes market.
There were also repercussions for the trade-up market, with first-home buyers not absorbing listing stock at the rate they once were.
“The grant unfairly penalises buyers wanting to enter the established market by only providing assistance to those who choose to build a new home,” he said.
The State Government is not considering introducing a grant for established homes in the upcoming budget.