First home buyers are unknowingly making poor investment choices in order to take advantage of the First Home Owner and HomeBuilder grants, according to a property expert who says the grants are aimed at builders, not buyers.
Veronica Morgan, Good Deeds Property Buyers agent, said the grants, that ranged from $10,000 to $25,000, were steering young people to buy properties which may yield little in value.
“These grants are not for the benefit of first home buyers at all, they have been primarily designed to bolster the construction industry to stimulate the economy,” Morgan said.
“There’s a lot of Government encouragement to buy brand new but the problem is that it’s the riskiest segment of the market.
“The pressure needs to be on developers and builders to build quality property, not pressure on first home buyers to jump in and make some quick savings – that’s a false economy.”
Oversupply and continued subdivision would be another cause for value loss and a large proportion of properties purchased off the plan or brand new on-sell at a loss.
“The issue here is scarcity,” Morgan said. “Who’s going to buy your home if you need to sell when there are new houses available five minutes down the road and the Government is incentivising the next lot of first home buyers to buy those rather than your place?”