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Wednesday January 7, 2009

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YOUR SAY: Hinch slams first home-owners increase

Posted by: Derryn Hinch, 3AW Drive | 14 October, 2008 - 3:50 PM
K Rudd

Only last week Prime Minister Rudd was painting black pictures on the unacceptable cost to the Government of an immediate increase in the pension. Even $10 a week would add $2 billion a year to the Budget.

As I said then: Big deal. That would cut his Budget surplus from $22 billion to 20 billion. And as I also pointed out when pensioners get any increase that money goes straight back into the economy. They don't hoard it for a rainy day because it's pouring already.

But forget old people. And they are easily forgotten. If you want to grab a headline give more money to young people. Like increase the First Home Loan bonus. Again. The Howard Government, always with one eye on the ballot box, started at $7000 and increased it to $14,000. It's now back to $7000 but Rudd is about to make it $14,000 again. Why?

I know the polis prattle on about the Australian dream of owning your own home. Some, on the campaign trail, even call it your right. Well, it is a dream, an honourable and worthy and often tangible dream. But it is not your right.

I know of people who didn't even start to own their own home until they were in their 40s. Some people never own their own home.

I know the argument about kick-starting the economy - especially the housing industry. But if Governments, especially state governments, were serious about it they would slash, even abolish, land taxes and especially the crippling and unfair Stamp Duty.

It's a Government licence to print money. They are gangsters. The Brumby Government takes billions of dollars a year in Stamp Duty for nothing. I have mentioned before a survey that shows our government is one of the greediest, most rapacious, most money-hungry governments in the world.

Stamp Duty for a property in Melbourne is much, much more than for a similar property in the United States or Canada or the UK.

On a $500,000 property you would pay just over $4000 in Stamp Duty in New York, $5000 in London and $6000 in Toronto.

You know what you pay in Melbourne?  $22,000.  And it escalates rapidly after that. On a property worth $650,000 you would pay around $33,000.

And you are paying those huge lump sums out of already heavily taxed dollars.

It is unfair. It is unconscionable and once the states started raking in those billions from the GST then Stamp Duty should have been abolished.

And finally on the First Home bonus. It's being offered to a generation that largely doesn't want it or need it. I mentioned a survey of Generation Y several months ago. It showed they spend nearly $50 billion a year on 'hedonistic pursuits'. And good luck to them. Entertainment, fashion, sport, travel and music.

If they want to buy a house let them scrimp and save and sacrifice for it. Like their parents and grandparents did. If there's any Government money to throw around give it to the pensioners.

Blog comments Your Say

  • Bravo Derryn,you are right about stamp duty. I thought the GST was supposed to take care of all these hidden taxes but as I understand it it has been used for anything but.
    Well we can only blame ourselves. We put him in. Frankly if I wanted to make the most of my money I would take notice of business men not school teachers and solicitors.
    Australia will only benefit if we get rid of this govt. We only stopped liking HOward because of what the labor oriented media said of him and the constant references to his being old etc. It was brain washing. they are doing it now. Say a thing constantly and people believe it. Keeping my fingers crossed for a change next election. YOu can bet they will spend money like a man with no arms close to the next election and that is what they are saving up for

    doreen Tuesday 14 October, 2008 - 5:11 PM

  • Nowaday, buying property is investment whether than need. Even with high rents we have now, they never too close to interest return. If helping those living in harsh conditions is Kevin's plan, believing those helped will used the money offerred, I can't see first-home buyers are the right group. There are many ways to kick-starting the economy, but not intervene the property market, unless he and his Cabinet believe the housing price is reasonable low now. I may like to remind him that the US or now Global economy crisis is originated from the collapse of US property market. Do we need a smarter leader or briain tank for Australia?

    Seto Wednesday 15 October, 2008 - 12:45 AM

  • How lucky young Australians are.
    Here nobody is that lucky.
    Unemployment benefit is only for 1 year and that's only if you have accumulate 900 hours of work.Then find yourself a job and start accumulating.
    No perks for elderly e.g free annual train ride to anywhere in the province.
    Teenagers do not get allowance for leaving the family home at 16 yrs of age and live on their own.
    Nothing is given to first home buyers.
    You have to pay a welcoming tax to the borough you bought your house.

    jeannette Wednesday 15 October, 2008 - 10:53 AM

  • Someone needs to do something. I am in the constantly left out bracket. Cant afford a house as i work 30 hours a week and study, dont have kids, am no where near a high income earner but earn just over what is considered low. So repeatedly get nothing. INfact my boss tried to help me by giving me a pay rise and instead it cost me money as it entered just over the HECS repayment of 4% level so i cant win. Who helps people like me. Do i need to have kids or get a mortgage or lower my hours so get benefit? All of which are not possible.

    Leahanne Wednesday 15 October, 2008 - 1:22 PM

  • so Kevin Rudd is now Mr.Inflation. Couldn't he have just let well alone- put the money into guaranteeing deposits etc is a good thing BUT why does he think increasing the first home owners grant is going to make property cheaper- it is going to do the opposite. Giving a sector of the market even more money to go to their bank with, means they have more borrowing capactity meaning that they can bid higher at auctions therefore pushing the price up.

    Only one bidder can ultimately be successful at an auction, so all that extra money is doing is push the price up. IT IS THE LAST THING home buyers want. Unscrupulous real-estate agents and greedy vendors will now factor that into their wanted price.

    If you want to push prices down- outlaw the disgusting, obnoxious practice of vendor bids. Where the price doesn't reach what the vendor & agent want, so they make a vendor's bid (why would a vendor bid on the house- when he/she is selling it- its incongruous) and completely distort the price and therefore the value of the property. Auctioneer then pleads with people to bid so they get 1st right to negotiate when passed in, but of course that is at the inflated/artificially creatd post-vendor's bid amount. It is a disgusting practice, and the increasing of the first-home owners grant just shows how short-sighted this Labor government are. Watch the prices rise as the government encourages more debt!!!

    Paul Wednesday 15 October, 2008 - 1:48 PM

  • They still have to 'scrimp and save' Mr hinch - even with the increase. The bottom line is pensioners should be - and should have been - getting more all along, and not in place of helping others who would benefit from assistance.
    I work in real estate Derryn, and trust me when I say the 'scrimping and saving' is alive and well. Some of the first home buyers I deal with are in their 50's, not 20's.

    Catherine Wednesday 15 October, 2008 - 4:30 PM

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