Kevin Rudd urged to extend increase in first-home buyers grant

KEVIN Rudd is under pressure to extend the increase in the first-home buyers grant beyond June 30 after the measure lifted the purchase of new homes by 10 per cent in its first month.

Housing Minister Tanya Plibersek refused to rule out extending the grants, which were doubled to $14,000 for existing homes and $21,000 for new homes in October last year as part of the economic security package, The Australian reported.

New figures released today showed the increased grants are boosting the sale of new homes, however, the Coalition warned the measure was not delivering a long-term boost to the market.

Between October and November the number of new houses purchased by first-home buyers jumped by almost 10 per cent, Australian Bureau of Statistics figures released today show.

But the newcomers failed to offset an overall decline in the housing market, which slowed by about one per cent from October to November.

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I don't want him to extend it I'd like to see him compensate those that have never received it..

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First Santa of Sydney
Opposition housing spokesman Scott Morrison warned the housing sector would need more than a short-term stimulus to turn around a 21.8 per cent decline in housing finance for the construction and purchase of new dwellings in the first 12 months of the Rudd Government.

"... We have a long way to go and we must ask the question: What happens once the stimulus is removed?” he said.

"The one-off boost to a discrete section of our housing sector provided by the first-home owners grant is not a long-term answer.

"At best, it provides a stimulus at the margin while key issues necessary to restore confidence and growth are left unaddressed."

Independent mortgage broker Loan Market Group says the increased grant, due to expire on June 30, should be extended for another six months.

“There was very little interest from first-home buyers throughout most of 2008, but now brokers and property-related websites, including our own, are being flooded with interest from these sources,” director John Kolenda said.

“First-home buyers are out there on the frontline for the first time in many years.”