Scheme misses mark:MBA

THE Federal Government’s new First Home Owners Scheme is missing the mark, according to the Master Builders Association of WA.

It claims the scheme has resulted in a dramatic slump in WA’s building industry.

MBA director Michael McLean said the first two months of the scheme’s operation resulted in only 465 applications for new home construction in WA.

“This was only 15 per cent of the total number of applications,” Mr McLean said.

“More than eight out of every 10 applications were for the purchase of an established house, which is unaffected by the GST.

“The scheme is missing its mark. It was designed to offset the effects of GST on new housing, but most of the money is being spent on established houses which do not have any GST on selling prices.”

The MBA has sent a submission to the WA Minister for Housing Kim Hames calling for, among other things, to better target buyers of new rather than established housing.

The MBA believes assistance to buyers of new housing should increase to $10,000 while established homebuyers should continue to receive $7,000.

The association is also calling for an interest rate subsidy to counter increases in mortgage rates.

Mr McLean said redirecting the First Home Owners Scheme to new homes would help the building industry.

Data from the Australian Bureau of Statistics on the commencement of dwelling units indicate a 35 per cent fall, seasonally adjusted, in the number of WA dwelling units started during the June quarter.

This followed a 24 per cent jump in the previous quarter.

Australia-wide figures show the number of dwelling units were not hit as hard but still fell about 10 per cent.

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