11/05/2004 - 22:00

Property tax doubt

11/05/2004 - 22:00

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PROPERTY industry groups have been quick to criticise last week’s budget despite the State Government’s efforts to promote the benefits to property buyers as one of its major selling points.

Property tax doubt

PROPERTY industry groups have been quick to criticise last week’s budget despite the State Government’s efforts to promote the benefits to property buyers as one of its major selling points.

REIWA president Jim Henneberry said the budget was a good first step, but the Government’s failure to commit to a further reduction in property taxes was a negative. 

“Since coming into power, this Government has increased property taxes 25 per cent, and the recent budget has only given a 5 per cent decrease,” he said.

Concessions to home buyers will not take effect until July 1, and the industry is concerned a substantial negative impact on the property market will result. 

While first home buyers comprise 16 per cent of purchases, it is expected there will be a flow-on effect to second and third home buyers.

Roy Weston CEO Geoff Baldwin said that, in the two days after the budget was released, Roy Weston’s 50 offices throughout Western Australia reported no sales to first home buyers and a drastic reduction in offers across the board. These were the worst sales figures for first homebuyers in 15 years, he said.

“The flight of first home buyers from the housing market has already started to impact on the second and third home markets because of the ripple effect,” Mr Baldwin said.

“Existing homeowners need to sell their properties to first home buyers to upgrade to more expensive homes, so the virtual absence of first home buyers from the housing market will strangle the housing market over the next two months.”

Homebuilder Dale Alcock said removing stamp duty for first home buyers was a welcome step in the right direction, but called on the Government to make the changes effective immediately.

“The Government needs to do it now or else the housing market will be in complete limbo until July 1, while West Australians simply hold off on buying or selling,” he said.

Urban Development Institute of Australia WA executive director, Marion Fulker, said it was “not good government practice” to wait until July 1 to implement the changes. 

“When similar changes had been announced in other States they had become effective from the date of the announcement,” she said.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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