Fear scheme puts houses out of reach
THE price of houses in Cairns is likely to be pushed up and out of reach of firsthome buyers by federal budget housing initiatives, experts say.
The median price of a home in Cairns is $527,388 – up 11.2 per cent over a year – but the cap for the government’s Home Guarantee Scheme for regional Queensland is $450,000.
On Friday, there were just five houses in that price range on the market.
The scheme, expanded to 50,000 places, allows buyers to stump for as little as a 5 per cent deposit for their home, with the government guaranteeing the rest.
While a unit can be bought for well within $450,000, there are few houses with a price-tag of $450,000 or less, they sell within days of being listed, and homes in Cairns are selling for well above the listed price.
Australian Housing and Urban Institute managing director Michael Fotheringham said regional areas like Cairns had less stock available, and the impact on prices could be greater.
“There’s a risk this scheme will drive prices up now the scale of the scheme has been ramped up,” Mr Fotheringham said.
“It could have an upward effect on prices, and if there aren’t eligible homes to buy, it is not going to have any effect and no one can use it.
“In Far North Queensland it is about availability as much as affordability, there
is a lack of stock even to rent, and you end up with people who are moving into the area for work sleeping in their car,” he said.
This hampered the growth of the region, he said.
“The scheme is more about helping people who are on the way to home ownership than getting people in who wouldn’t have gotten there otherwise.”
He said there was little affordable housing – $450,000 or less.
“What the scheme doesn’t do is produce an affordable supply for purchase and renting.”
PropTrack economist Angus Moore said more needed to be done to address housing supply.
“Schemes like the Home Guarantee Scheme are good as short-term ways to help first-home buyers, but if we’re serious about solving affordability, the only longterm solution is building more homes,” Mr Moore said.
“Given prices in regional areas have outpaced capital cities over the past couple of years, affordability for regional buyers is likely to have become stretched,” Mr Moore said.
Shelter Housing Action Cairns executive officer Sally Watson said budget dollars should have been spent on desperately needed social housing.
“The budget did not address the growing rental supply crisis and it did not address the growing rental affordability crisis,” she said.
“It’s extremely disappointing to see that the only housing initiative in the budget was a doubling of the home guarantee scheme which is likely to impact negatively on the market, adding fuel to the fire representing the continual rise in housing and rent prices.”
The Home Guarantee Scheme, which allows buyers to stump up as little as a 5 per cent deposit, has been expanded to 50,000 places.