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Warnings have been sounded about Tasmania’s real estate market as the first home buyer sector declines and new borrowers prepare for a $30,000 hit.
The state’s First Home Owner Grant, which provides $7,000 to new buyers, will be scrapped at the end of June.
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The First Home Builder Boost, which provides an additional $23,000 to borrowers who build a home or purchase a newly built home, will expire at the end of December.
Loan Market Launceston broker Kristy Wilson said the First Home Owner Grant had helped buyers enter the market by covering costs such as stamp duty and legal fees.
“For many buyers, it may take years to save up the additional money this grant saves them,” she said.
“The First Home Owner Grant has ceased in most other states and it’s made it difficult for first time buyers to crack those markets.
The Real Estate Institute of Tasmania (REIT) has also expressed concern, after a report published this week showed that first home buyers’ share of the market fell from 18 per cent to 17 per cent between the December 2013 and March 2014 quarters.
REIT president Adrian Kelly said the first home buyer market would continue declining unless the government retained the First Home Owner Grant.
“If the grant is to be axed, we look forward to seeing what alternative measures are to be introduced by the new Liberal government,” Mr Kelly said.
