First homebuyers in NSW are left waiting for high levels of home building to translate into falling property prices as the NSW Budget showed no new grants or concessions for them.
However, NSW treasurer Gladys Berejiklian claims that they were “doing everything they can” for first homebuyers, adding, “I make no bones about the fact I believe [housing affordability] is one of the biggest challenges facing us.”
The recent four-year house price boom has left Sydney’s median house price just a bit shy of $1 million as underbuilding in 2012 resulted in a pent-up demand for housing stock. But in the 12 months to April 2016, housing hit a record high with 70,000 dwellings approved. This could continue until 2018, and Berejiklian believes that the prospect of an apartment glut was “not a bad thing for first homebuyers.” She expects price falls to happen in the next few years, although there is no mention of hoe much property prices could drop.
Still, low-income earners are left grappling with higher city rents, as even first homeowner incentives are not enough for them to gain a foothold in the Sydney property ladder. Even though foreign investors in Australian residential real estate are now slapped with a stamp duty surcharge and land tax, the extra revenue will not be channeled into affordable housing measures for first homeowners.
“I think it’s entirely reasonable that at least a part of the revenue raised on the back of the state property’s boom could be used to help those struggling as a result of the boom,” said Wendy Hayhurst, CEO of NSW Federation of Housing Associations. “Today’s budget is particularly disappointing in light of figures that only last week showed people in Sydney are paying as much as 85 per cent of their income in rent.”
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