State treasurer Eric Ripper has refused to be drawn on the possibility of cuts to stamp duty despite an increasing din of voices demanding change and further evidence that housing is affecting competitiveness.
State treasurer Eric Ripper has refused to be drawn on the possibility of cuts to stamp duty despite an increasing din of voices demanding change and further evidence that housing is affecting competitiveness.
Mr Ripper said his support for tax cuts was ongoing and he had not been hinting that they were imminent when responding to a Housing Industry Association statistics yesterday showing housing affordability had fallen to at least a 22-year low.
He said it would not be known until the budget whether stamp duty rates will change.
Concerns raised by HIA figures showing Perth was less affordable than Sydney have been heightened by a new survey which shows Australian housing is among the world's worst.
The Annual Demographia survey, released today by the US-based Wendell Cox Consultancy, rated every Australian city as "seriously" or "severely" unaffordable in a global study of 159 cities, with Sydney, Melbourne, Perth and Hobart among the worst 25 cities. That survey rated Sydney as worse than Perth.
The affordability issue prompted acting federal treasurer Peter Dutton to call on state governments to cut stamp duties on conveyancing and to release new land for development to make housing affordability easier for first home buyers.
State Liberal deputy Troy Buswell weighed into the issue stating that the government had to provide immediate stamp duty relief to first homebuyers.
Mr Ripper said today that while housing costs were of critical concern to the government, the issue went beyond tax relief for first home buyers.
The Treasurer said that while he supported stamp duty relief for first home buyers, any announcement would have to wait until the state budget was unveiled later this year.
The Housing Industry Association yesterday announced that Perth had become the most unaffordable city in Australia during the December quarter of 2006, the first time a city other than Sydney had won that dubious honour since the index was established in 1984.
A 6.2 per cent increase in the median first home buyer price saw Perth's first home-buyer affordability fall by 7.4 per cent over the quarter and 34.5 per cent from a year ago. In regional Western Australia, the median first home price increased 9.6 per cent leading to a decrease in affordability of 10.3 per cent.
Below are announcements from Mr Ripper and Mr Buswell:
Housing costs were a critical concern to the Carpenter Government, but went beyond the single issue of first home buyer relief, Treasurer Eric Ripper said today.
"I set up the State Tax Review with the objective of providing genuine tax relief, and it was commissioned so that its findings could be considered for the State Budget in May," Mr Ripper said.
"It would be a mistake to see my comment yesterday as a new announcement. It is in fact the same sentiment I have put to the community for months. I support tax cuts."
The Treasurer said for most, the economic boom had been good news. But rapidly increasing house prices had disadvantaged some people.
"What the Government is now doing is considering ways to help these people, including, but not limited to, first home buyers," he said.
"The issue of rising housing costs is broader than first home ownership and warrants more than just one measure.
"Higher housing costs also affect the 30 per cent of people who do not own their own homes and who are exposed to rising rents in the private rental market.
"Although rental assistance is primarily a Commonwealth responsibility - and it is incongruous that people in Adelaide get the same rental assistance as Perth people - a worthwhile assistance package must also account for their needs. Any package must encompass a broad range of measures, including the need to increase land and housing supply.
"This is a key aim of the forthcoming State Budget."
Improving stamp duty exemptions for first home buyers had to be considered in the context of:
- the full scope of housing disadvantage caused by the housing boom and John Howard's broken promises on interest rates; and
- the community's legitimate requirements for money for key frontline service improvements, fair public sector wage increases and vital infrastructure.
Below is the announcement from Mr Buswell:
Shadow Treasurer Troy Buswell has called on the Carpenter Government to provide immediate stamp duty relief to first homebuyers in Western Australia.
Mr Buswell said the Housing Industry Association's report, which showed Perth had claimed the mantle as the most expensive capital in Australia for first homebuyers, was a sobering reflection on the failings of the State Labor Government.
He said Eric Ripper continued to hide behind the charade known as the State Tax Review and would delay any meaningful tax relief until the eve of the next state election, as was the case in 2004.
"The unfortunate reality is that Eric Ripper has no intention of providing stamp duty relief in WA until it becomes politically necessary," Mr Buswell said.
"But the people of Western Australia will not be fooled. Every Western Australian knows that the Government can afford to provide stamp duty relief and that first homebuyers desperately need help."
Mr Buswell said it was disappointing that despite the State's mining-led economic boom, the Carpenter Government had played a significant role in creating an environment in WA where the great Australian dream of home ownership was rapidly fading.
"The Government has failed to make adequate supplies of land available, creating the supply constraints which have helped force property prices up, and it has imposed Australia's most punishing stamp duty regime onto first home buyers," he said.
"Despite repeated warnings of a major land supply crisis over past years, the Carpenter Government has refused to act to free up land for new housing in and around Perth.
"Labor has an ideological obsession with forcing people to live in expensive inner city urban infill projects. This obsession coupled with an almost stagnant approvals process has created the ridiculous situation where Western Australia, one of the most land rich jurisdictions in the world, has a land shortage.
"Sadly it is Western Australia first homebuyers who are now being forced to pick up the bill for the Government's incompetence through one of the country's most aggressive stamp duty regimes.
Mr Buswell said the HIA report, combined with ABS figures that indicate Western Australian first homebuyer participation in the real estate market was at record lows, placed what should be irresistible pressure on Treasurer Eric Ripper to provide immediate stamp duty relief to first homebuyers to assist them in overcoming the hurdles of escalating housing prices and increasing interest rates as they looked to establish a foothold in the property market.
He said Eric Ripper had an obligation to provide stamp duty relief to first homebuyers to help encourage them back into the property market.
