Rudd Government’s Fiscal Stimulus Package

First National Real Estate, Australia’s largest independent real estate network, welcomes the Rudd Government’s fiscal stimulus package that doubles the first home buyer’s grant to $14,000 and triples the amount to $21,000 for newly constructed homes.

“The Rudd Government package will help underpin the property market at a time when confidence has been badly shaken by world economic events. A healthy, active housing market is essential to the Australian economy. First home buyers are now doubly advantaged by the largest official interest rate cut in sixteen years occurring at the same time as a big lift in government assistance” said CEO, Ray Ellis.

“However, fears of the package fuelling a spending spree are not unfounded and there is criticism that the home owners grant scheme has done nothing more than push up prices in the past, adding to affordability woes.

“More must be done to address the underlying factors that influence housing affordability and this goes way beyond simply upping the first home owner’s grant. Government must streamline the release of land for new construction and address the significant shortfall between supply and demand. Otherwise, when growth slows, as predicted, the property industry may falter.