Changes to First home owners scheme

| November 1, 2009

The first-home owners grant will be restricted to people buying homes worth up to $750,000 from next year amid fears the market is overheating.

Fierce competition that started late last year in the lower end has now expanded into the mid to upper sectors. A surge of Australian investors is also gaining momentum.Buyers of all budgets are increasingly concerned that missing out will mean a wait until autumn, when prices and interest rates could be greater.

First home owners grant Australia

On October 1, the first-home owners boost was reduced from $14,000 to $10,500 for existing homes and from $21,000 to $14,000 for new homes. The grant will be lowered to $7000 for both new and established homes from January 1.

Change to First Home owner grant

Each state and territory government would be allowed to cap the ”enormously successful” grant, federal Housing Minister Tanya Plibersek confirmed yesterday.

First home owners grant scheme PerthThe real estate crush has already contributed to a 1 per cent rise in the headline rate of inflation for the September quarter, the highest rate for a year. It makes a Melbourne Cup Day interest rate rise of 25 or even 50 basis points almost assured, as the Reserve Bank moves to tackle inflation before it gets out of control.

In NSW, Western Australia and the Northern Territory, only homes less than $750,000 will receive the $7000 grant. In Victoria, the cap will be set at $600,000 while Queenslanders will be able to pay up to $1 million and still receive the bonus.

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Category: Australia, First home Owners grant, home loans, Interest rate hike, investment property, Property Market, Property sector

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