The 2013/2014 Victorian state Budget will assist property owners overall but at the cost of first home buyers, according to the Real Estate Institute of Victoria (REIV).
REIV CEO Enzo Raimondo said the Budget overall will help boost the state’s economy.
“This year’s Budget aims to deliver the most important thing for the property sector: economic growth at healthy and sustainable levels,” Mr Raimondo said.
“The overall Budget settings are sound. History has shown that when the economy stalls, property prices and transactions drop, with consequences for home owners and ultimately the state Budget.”
But Mr Raimondo believes recent changes to first home buyer grants will be a huge burden on those looking to enter the property market.
“It’s a concern that the majority of first home buyers, especially those in regional Victoria and in affordable segments, will be worse off following the abolition of the First Home Owners Grant for existing homes.
“That measure will see a saving of $63.8 million in the next financial year and $402.8 million over the forward projections.
“The acceleration of the stamp duty cuts to 40 per cent does not cover the cost of the grants abolition for the majority of first home buyers. The state government should have matched the cuts in the grant with further reductions in stamp duty.”