The West Australian Friday, 28 July 2017 By Dylan Caporn and Helen Shield
First-homebuyer incentives are likely to be protected from State Budget cuts amid a warning from Housing Minister Peter Tinley that WA faces a looming affordable-housing crisis.
Mr Tinley said the Government would most likely protect the first-homeowner’s grant given the effect a cut would have on the low-deposit home-loan scheme, Keystart.
“I am very vocal that it does not get touched because the majority of the deposit for Keystart loans is actually made up of the first-homeowner’s grant,” Mr Tinley told an Urban Development Institute of Australia event on Wednesday.
“There is no plan to move the $10,000 at any stage.
“It’s not in any discussion. I just want to be really clear.”
Treasurer Ben Wyatt told The West Australian he would not be drawn into a rule-in, rule-out game with the State Budget on whether the grant would be kept. “This State is dealing with a financial mess of unprecedented scale and we are therefore reviewing each line of spending line by line,” he said.
“Any changes to the grant will be announced in the Budget on September 7.”
But in a parliamentary debate last month, Mr Wyatt flagged the Government would continue to provide “generous transfer duty concessions” to first-homebuyers, and hinted at the continuation of the $10,000 grant.
“For a new home in Western Australia valued at $430,000, the stamp duty concession, combined with the $10,000 first-homeowner grant, will provide first-homebuyers with assistance of over $24,000,” he said.
In last year’s Budget, spending related to the $10,000 grant was set at almost $300 million over the next four years.
But in December, the former government announced a $5000 boost to stimulate the housing industry.
Mr Wyatt ended that payment in June, saying it had failed to deliver results.
Mr Tinley said more government intervention was necessary to turn around a shortage of affordable housing in Perth and prevent generations of people from being locked out of the market.
“There remains a significant shortage of housing that is affordable to West Australians on low and moderate incomes,” he said.
“People on low incomes have simply been priced out of the market and I fear that if no action is taken by Government, they will be cut out of the market.”
Real Estate Institute of WA president Hayden Groves said while he did not think prices were unaffordable compared with other capital cities, given the market had bottomed, housing was at risk of becoming less affordable.
“We’ve had anaemic wages growth, supply of property has been relatively plentiful but property prices have remained stubbornly high because there’s not a lot of mobility in the market,” he said.
“A decade ago we had about 70,000 property transactions throughout Perth, and now we have 31,000 transactions.
“It’s all about planning. It’s all about how the planning process is undertaken and how developments are delivered in inner-city and suburban nodes where you can have a good mix of affordable housing. That has not been done in the last decade.”
Shelter WA spokesman Stephen Hall said lack of affordability meant people were stuck in rental accommodation.
“Research indicates this has poor outcomes for people and there is not a lot of rental stock available for low-income people,” he said.
“The rentals that are available do not meet peoples’ needs. The flow on from this is that it puts pressure back on the social housing system.”
A housing affordability report last year found less than 10 per cent of Perth properties were available for people on incomes of less than $68,000 a year.