House grant did its job: MP
Friday, 18th January, 2013
By Erica Visser
Local MP John Williams has hit back at criticism of the NSW Government's scrapping of the first home buyers grant, suggesting that the incentive would not make much difference.
The $7000 grant was cut at the last State budget and officially ended in October.
The month following saw the lowest number of loans approved for first home buyers in decades.
Local LJ Hooker Principal, Jim Hickey, said this week that the scrapping of the grant had cut first-time buyers out of the market.
Twenty-three-year-old Tamara Cuffe rushed to purchase a house before the cut off date for the grant.
Ms Cuffe, who saved for six months for a deposit, said that it was difficult for young people to enter the market and cutting incentives only made it harder.
"I had already started to save before I knew the grant was being cut, but when I knew it made me limit my price range so I could buy before the cutoff
date," she said.
"It was hard to save the deposit and it limited what I did for six months but I was lucky enough to be living with my parents in the meantime.
"Without the grant I wouldn't have afforded the house for another 12 months or so.
"I can't comprehend how people renting, with or without families, save as I struggled as a single person living with my parents."
Mr Hickey said that many young people like Miss Cuffe had desperately sought to buy a home before the grant ended.
Mr Williams said that the grant was a help for first-time buyers, but he did not believe it would affect their decision on whether to purchase a house.
"There's a sunset clause on everything. Obviously it's a nice assistance but ultimately most young home buyers wouldn't rely wholly on that," he said.
"I think the decision to buy a house obviously looks at a greater range of aspects."
Mr Williams said that the grant was scrapped because the Government would have decided the stimulus had worked.
"Obviously this was a stimulus designed to lift the building industry and recently what we've seen is the building industry in NSW is better than in most states," Mr Williams said.
In its place is a $15,000 grant for first home buyers who buy or build new homes.
The grant has been criticised, both by Mr Hickey and the State Opposition, because many first time buyers cannot afford a new home.