The Western Australian government has upped the amount it’s offering first home buyers to $10,000 (up from $7,000 previously) for those purchasing newly built homes – but cut the grant for those buying established dwellings to $3,000.
These changes come into effect from September 15 and are expected to save $118.6b over the next four years. The WA government estimates that around 800 first home buyers will switch from buying an established home to building or buying a new one.
“We want to focus on using our finite resources to stimulate the supply of new homes,” treasuer Troy Buswell says in an interview with the Australian Financial Review.
On the flip side, the WA government plans to lift the land tax rate by 12.5% this year, generating $388m over the coming four years.
Buswell says the state’s growing population, which has been increasing at 3%, is creating greater demand for new housing stock. An extra $47.8 million will be offered to landlords who rent to lower earners at rates 20% below the market.
WA’s move differs from that taken by other state governments. VIC recently reduced its $7,000 grant to first home buyers, while NSW and QLD replaced their $7,000 grant with $15,000 grants for those buying new.