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Potential first home buyers who are struggling to enter the property market could benefit greatly from an increase to the First Home Owner’s Grant, a national survey has found.
According to the Loan Market survey, 55 per cent of brokers believe an increase to FHOG in the upcoming May budget would bring first home buyers back into the market.
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“A boost to the FHBG could help thousands of people wishing to purchase their first home. It could also provide a much needed spark to the property market,” Loan Market group’s chief operating officer Dean Rushton said.
“It’s no secret that first home buyers are struggling to obtain a foothold in the property market.”
Mr Rushton said that an adjustment to the FHOG was necessary because the $7,000 grant had not kept pace with increasing property prices since the scheme was introduced in 2000.
“The latest data shows the median price of a home in a capital city is just over $450,000. When the scheme was introduced in 2000 the median price was $220,000. Clearly we’re dealing with a far different economic environment,” Mr Rushton said.
“A grant of $7,000 is no longer sufficient because of the elevated costs first home buyers are facing.”
Mr Rushton said it was no surprise to see broker support for the First Home Saver Accounts scheme at the bottom of the survey.
“The scheme when it was launched was aiming to assist more than 700,000 people within the first four years but it has attracted nowhere near the amount of interest anticipated,” Mr Rushton said.
“The First Home Saver scheme has been unproductive and an extension of the grant would be a far more effective policy instrument.
“The upcoming federal budget is an excellent opportunity for the government to assist many of the people it originally set out to help with this scheme.”
