Lower stamp duty or new grants are needed to tackle the dwindling numbers of first home buyers entering the Victorian property market, REIV chief executive officer Enzo Raimondo has said.
According to Mr Raimondo, the number of first home buyer numbers has reduced significantly due to rising property prices, shortage of stock and higher state government taxes.
“Stamp duty revenue has more than trebled in 10 years and is adding significant financial burdens at a time when buyers can least afford it,” Mr Raimondo said.
“The answer to improving affordability is reducing stamp duty, building more homes and increasing first home buyer assistance,” he said.
According to the REIV, first home buyers represented 28 per cent of the market a decade ago. 12 months ago, first home buyers represented 27 per cent but in August this year it had dropped to 17 per cent.
Mr Raimondo also said the $7,000 First Home Owners Grant introduced in 2000 went a long way to helping buyers pay the stamp duty on their homes.
He said in the case of 30 suburbs, including Vermont, Richmond and Box Hill, the grant left buyers with extra to go towards the home purchase.
“Ten years later the failure of the state government to control escalating stamp duty bills or increase the grant means that now the grant is little more than a small subsidy on the stamp duty.
“The state government is giving with one hand, taking more with the other and leaving most first home buyers out of pocket,” he said.