First Home Buyer Numbers Drop, Stamp Duty Increases

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9th November 2010, 06:00am - Views: 791





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Media Release 



The Real Estate Institute of Victoria Ltd

Telephone (03) 9205 6666

ABN 81 004 210 897





      



Tuesday 9 November 2010


First home buyer numbers drop, stamp duty increases


The number of first home buyer numbers has reduced significantly due to affordability declining in

Victoria as a result of rising property prices, shortage of stock and higher state government taxes.


REIV CEO Enzo Raimondo said that it is incumbent on all political parties contesting the election to

outline how they will address housing affordability in Victoria and assist first home buyers. In four other

Australian states most first home buyers pay no stamp duty; the question is why can’t that happen in

Victoria?


“When the First Home Owners Grant was introduced in 2000 it provided buyers with $7000, an

amount that went a long way to paying the stamp duty on most homes and, in the case of 30 suburbs,

left buyers with extra to go towards the home purchase.


“Ten years later the failure of the state government to control escalating stamp duty bills or increase

the grant means that now the grant is little more than a small subsidy on the stamp duty.


“The state government is giving with one hand, taking more with the other and leaving most first home

buyers out of pocket.


“According to the ABS, 10 years ago first home buyers represented 28 per cent of the market. A year

ago it was 27 per cent and in August this year it had dropped to 17 per cent.


“Ten years ago a first home buyer in Broadmeadows who received the $7000 grant had nearly $5,000

remaining after stamp duty; now they have to pay an extra $6,600. In Box Hill if they purchased a

modest unit they would have had $1,200 left over; now they need to pay another $10,870.


“Stamp duty revenue has more than trebled in 10 years and is adding significant financial burdens at a

time when buyers can least afford it. 


“The answer to improving affordability is reducing stamp duty, building more homes and increasing

first home buyer assistance,” Mr Raimondo concluded.


Ten of the 30 suburbs* where recipients of the First Home Owners Grant were left with money

to help pay for their home after paying stamp duty:

 


Vermont, $240 


Richmond (units), $360 


Box Hill  (units), $1,200 


Ferntree Gully, $1,274 


Sunshine, $2,640 


Bayswater, $2,940 


Melton,  $3,660 


St Albans, $3,840 


Footscray West (units), $4,620 


Broadmeadows, $4,734


*based on the median price of a home in the September quarter 2000 and stamp duty payable at the time.


MEDIA COMMENT:

Robert Larocca, 9205 6622 or 0409 198 350






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