TIME FOR FIRST-HOME BUYERS RETHINK

IT is a $50m question? With the cost of housing having soared to almost unimaginable highs, what can be done to help first-home buyers get that all-important foot on the ladder? Fifty million dollars is the amount the Queensland government has saved due to the enormous drop in the number of its first-home owners grants doled out in the last financial year, compared to the previous 12 months.

The Gold Coast, where the number of grants issued fell from 1046 to 460, accounted for almost $9m of that saving. The figures show that the grant is no longer serving its original purpose. This is hardly a surprise, given that it is restricted to new builds and cannot be used to buy properties valued at $750,000 or more.

On the Gold Coast, the median house price has pushed past $1m in the majority of suburbs, while the supply of land for residential housing has been largely exhausted.

The obvious answer to the problem would be to raise the $750,000 threshold – which has not changed since 2012 – to better reflect current house prices. Treasurer Cameron Dick has ruled out the move, cautioning that the government would risk fuelling further price inflation.

However, it is worth remembering that first-home buyers do not make up the majority of the market. The latest ABS data suggests, in fact, that in Queensland they are just 27.9 per cent of it. It may also be time the decision of the Newman government in 2012 to restrict the grant to new builds was rescinded. The new builds market has changed dramatically since that time, with first-home buyers on the Gold Coast largely restricted to purchasing existing properties.

The government would deny that it is saving money at first-home buyers’ expense. It counters, sensibly enough, that the only true means to boosting affordability is through greater supply.

In this regard, it points to the $200m commitment to a Growth Acceleration Fund in the state budget.

The fund is to help create roads, water and sewerage infrastructure in areas that might support new housing.

But given this city’s geographical constraints, there is little prospect that much of this money will be spent on the Gold Coast. We know because we have been here before. There has been crickets from a taskforce called the Growth Areas Team announced by Deputy Premier Steven Miles in March 2021 about plans for the Gold Coast. In the meantime, first-home buyers continue to struggle.

We should not abandon the longstanding principle of giving them a leg up in the market. Something should be done. The good news is, there’s $50m available to get the ball rolling.