Victorian Premier, Daniel Andrews, has launched a new housing affordability gimmick, proposing to abolish first home buyer grants because they have “failed to boost housing affordability”.
The scheme offered $10,000 to first-time home purchasers who acquired a newly built home worth up to $750,000.
In the last financial year, the state government distributed 11,381 grants totalling $123.6 million.
Such first home buyer grants raise home prices and hinder affordability because they pour government funds into the private housing market.
Therefore, Andrews’ plan to axe such grants is a sound idea.
The problem is that Dan Andrews is instead planning to replace these first home buyer grants with a new housing package that includes a “beefed up share equity schemes and stamp duty concessions”.
Both increase demand and do nothing for supply, counteracting the benefit from axing first home buyer grants.
Thus, Dan Andrews’ housing affordability plan is akin to shuffling the deck chairs on the housing Titanic. It is pure policy spin over substance.
It also comes as Premier Dan Andrews has been actively lobbying the Albanese Government to lift already record levels of immigration, which is the key factor behind the nation’s (and Victoria’s) rental crisis.
“We need to do more as a nation to recruit more of those people to come here, not just for a job, but to build a new life because we all benefit from that. So, I’ve always been a very strong supporter of more skilled migration”, Andrews said in an interview earlier this month.
“And the new federal government have taken some important steps towards increasing the amount of permanent skilled migration, but I think they might need to do more again”.
“Prime minister Albanese knows this. I’ve spoken to him about it personally and part of it also is clearing the Visa backlog”.
The extreme population growth in Melbourne is already seeing the city suffer from chronic shortages of both housing and infrastructure.
These shortages would only worsen under Dan Andrews’ extreme immigration plan.
The first best solution to Australia’s (and Melbourne’s) housing crunch is to reduce immigration to levels that are proportional to our ability to supply new housing and infrastructure.
Nobody voted for Labor’s massive immigration plan, and Australian voters overwhelmingly oppose it. Enough already.
