Prosper Australia

Buying a home is a major life-event. Most people need a mortgage to bridge the gap between their savings and house prices. But the Victorian government imposes Stamp Duty at this critical point, increasing the capital needed and lengthening mortgage repayments by an average seven years. Many citizens are either excluded or deterred from home ownership by this extra cost, which traps them in the rental market. We are all diminished.

There is a better way. Remove this burden and fund the change by ending the principal residence exemption from State Land Tax an efficient and just way to fund government.

As the Fairfax papers reported on April 14, the NSW government has rejected yet another recommendation to replace conveyancing stamp duty by a broad-based land tax. That is the effect of the “stamp duty replacement tax” recommended on page 13-4 of the Lambert Report, delivered in September and quietly released in February. It is often said [...]

Australia has experienced nine quarters of falling land sales volumes with the last five quarters flatlining forty per cent below long term averages. The big falls in prices we have been predicting are now a certainty.

If BoQ writes big losses and needs capital due to land price falls so far, what shape will the bank be in when the big corrections start?

Philip Soos notes eight of the nine substantial property price increases over the last 131 years have resulted in a decline. He can’t see why the largest increase on record would not precede another drop now. Soos does not buy the argument that Australia is suffering from a “chronic housing shortage”, saying property prices have continually experienced boom-bust cycles regardless of population growth.

“the results of the CIE study do not allow an assessment of the relative inefficiencies of each tax.”
When discussing the efficiencies of taxation, surely the inefficiencies must be counted too!

From the Canberra Times 5 April 2012. Your article “Capital’s housing prices highest in the country” (April 3, p1) was missing one very important word – land. As we move toward Canberra’s centenary celebrations it is time to reflect on the great wedge that is driving an ever increasing gap between the privileged and unprivileged [...]

On Monday the Real Estate Institute of Victoria made public its submission to the Victorian Government on the framing of the state budget. They are big-hearted enough to call for an end to the First Home Bonus – a ‘gift’ to buyers that merely inflates land prices by more than the bonus and enriches sellers. [...]