source: SMH http://tinyurl.com/c7m4ypk
The number of people in NSW looking to buy their
first home fell to its lowest level in 21 years in December, showing that the
government's bid to encourage first-timers to buy new homes still has some way
to go.
The senior economist at Australian Property
Monitors, Andrew Wilson, said there were just 998 loans (for both new and
existing homes) taken out by first-timers across the state, compared with 2217
in Victoria and 1556 in Western Australia.
The fall coincides with changes to first-home buyer
incentives. The First Home Owner Grant was withdrawn on October 1 for
purchasers of existing homes. It was replaced with a $15,000 grant to buy a new
house or apartment priced below $650,000.
"It's the lowest number of first-home-buyer
home loans approved in a month since January 1992," Dr Wilson said.
"And the proportion of first-home-buyer loans
to total loans is 8.1 per cent in NSW, the lowest proportion ever recorded.
"The average over the 20 or so years is 18.7
per cent.
"We've seen a significant collapse . . . this
shows that first-home buyers have not been activated to buy new homes."
A year earlier, in December 2011, 4256 first-home
buyers took out loans. At that time first-home buyers were rushing to beat the
end-of-year deadline on stamp duty savings of $22,490 which applied to all
properties under $650,000. They also got the $7000 grant.
Fast forward to December 2012 and buyers had the
same stamp duty exemptions, and a $15,000 grant, but only for new properties.
They have until the end of this year to take up the O'Farrell government's
carrot.
The decision to withdraw the stamp duty incentives
for existing properties was announced in September 2011 as part of the state
budget. Back then real estate agents were scathing. The Raine & Horne
chief, Angus Raine, had urged the government to reconsider its decision because
first-home buyers wouldn't go for new property, primarily as it was more
expensive.
"This is not going to help young people jump
off the rental market treadmill and into their own homes," Mr Raine said.
The chairman of Ray White, Brian White, said the decision to cut the incentives
wasn't "quality thinking".
Yesterday the BresicWhitney principal Shannan
Whitney was surprised at the extent of the first-home buyer collapse.
"Those numbers are quite dramatic," he said.
Mr Whitney said it showed that first-home buyers
had rejected the government's goodies. "Frankly I think existing stock is
a better-value option for them because you pay a premium for new."
Nationally the proportion of first-home buyers
taking out home loans was 14.9 per cent. After the 8.1 per cent rate in NSW,
the next lowest proportion of first-time loans was in Queensland at 12 per
cent. "That was the lowest ever recorded in Queensland, too," Dr
Wilson said.
The Master Builders Australia chief economist, Peter
Jones, urged the Reserve Bank to cut interest rates at its March board meeting. "The decline in first-home buyers that
continued in December is a concern, given the various incentives across several
states to entice them into the market," Mr Jones said.
So what do you think? Do governments hand outs still work? Or are they designed to artificially inflate the property market?
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