28 April 2013

MELBOURNE: – Victoria’s new Treasurer Michael O’Brien taunts first home buyers with a cruel hoax today, announcing grants for new build and targeted stamp duty concessions. He confirmed their role as a patsy for every property-based parasite in Australia.

“First home buyers are being bribed with their own money,” David Collyer Campaign Manager Prosper Australia said today.

“These grants and the extra borrowing power they create were capitalized into land prices by sundown. It is already too late for home-buyers to take advantage of this offer.

“Estate agents and property developers are now toasting Michael O’Brien in champagne.

“Not one cent of this gift will end up with builders or the modest citizens who simply want a home of their own.

The economic fallacy of first home grants is clearly explained by Prof. Steve Keen at:http://tinyurl.com/br7t8o5

“If this has the intended effect of inflating real prices, then it will set a new, higher peak from which an even bigger crash will occur. Our towering private debt burden will likewise increase.

“Inexpensive land should be an explicit civic objective, not the maintenance of high prices by rationing and government intervention.

If the Napthine government genuinely wanted to help young adults become full citizens in this property-owning democracy, it would lower the price of land, not act to drive prices higher. The Napthine government should:

• Instruct Places Victoria to accelerate the release of subdivided land and price competitively.

• Agree to more Precinct Structure Plans that currently restrict land-buyers to a handful of locales.

• Abolish Stamp Duty on ALL property transactions and fund this by removing the Principal Place of Residence exemption from State Land Tax.

An entire generation is currently excluded from home-ownership – except on the most oppressive financial terms. At 14.4 per cent of all buyers, first timers are at the lowest proportion of buyers since 2004 – in a market notable for its weak sales volume. They do not need incentives, they need a land price re-set.

“This initiative should be condemned by all.”


About Prosper: Prosper Australia is a tax reform lobby group and think tank that is now 120 years old. It seeks to move the base of government revenues from taxing individuals and enterprise to capturing the economic rents of the natural endowment, notably through Land Value Tax and Mining Tax.