Page 1190 - Week 04 - Tuesday, 24 March 2009
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important initiative for the ACT as it will allow many to achieve their dream of home ownership as well as boost the local economy and facilitate the local building industry to maintain jobs through these difficult financial times. The Greens welcome this initiative from the commonwealth as it will provide necessary assistance to Canberrans who are embarking on home ownership for the first time.
MR SMYTH (Brindabella) (12.18): This bill provides for a short-term boost to the value of the grant given to first home owners. The first home owners grant is a policy of the federal government, started, of course, by the previous federal government. The ACT, along with the states and territories, administers this scheme on behalf of the federal government, so to this extent the ACT is simply making sure that those who live in the ACT who are entitled to the assistance receive it and that those who are not entitled do not receive any assistance at all.
As far as this bill is concerned, the additional impost on the ACT government in terms of administration is minimal; provided a person or couple is entitled to a first home owners grant, the original grant and the relevant boost grant will be paid. Nevertheless, the focus of this bill is of some interest. The boost provisions comprise two components. In the case of people who are buying their first home—that is, buying an established property—the boost grant is $7,000. In the case of people who are building their first home, the boost grant is $14,000. In the context of the current economic climate, this differentiation in the focus of the first home owners boost is clearly intended to provide a stimulus to builders of new homes and to suppliers of goods and services to those builders.
The latest statistics from the Australian Bureau of Statistics—soon to be cut by the federal Labor government, of course—suggests that the boost policy is having some effect. The national data on housing finance commitments for January 2009 show that the proportion of dwellings that were being bought by first home buyers reached the highest point since this statistical series was commenced in 1991. According to the ABS, more than 26 per cent of finance commitments for houses were from first home owners. Research that has been conducted by the ANZ bank, however, suggests that first home owners could comprise as much as 40 per cent of all homes being sold.
In the ACT the pattern for the first home owners grant shows that there were 102 grants in November 2008, 201 grants in December 2008 and 223 grants in January 2009, so it is refreshing to see that first home owners appear to be regaining access to the purchase of their own homes, despite, as the Leader of the Opposition has so eloquently pointed out, the failed land rent scheme and other policies of the Stanhope-Gallagher government.
As I noted a moment ago, the boost policy is only intended to be short term. The policy commenced on 14 October 2008 and is due to expire on 30 June 2009. In the way of human nature, we could anticipate a rush as people seek to take advantage of this policy over the next few months. Of course there will need to be further consideration given to this policy as the end of June approaches. It is easy to contemplate a dramatic turnaround in the housing market if there is a combined effect of the cessation of the first home owners boost and a sustained increase in unemployment. This is a broader mix of policy matters that will need to be considered by the federal government as it responds to the looming end of the boost policy.
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