Changes to the First Home Owners Grant (FHOG) missing the mark

The Western Australian Labor Government should be looking at stamp duty, rather than the First Home Owners Grant (FHOG) if it wants to improve budget sustainability and improve housing affordability. 

Treasurer and Finance Minister Ben Wyatt this week (17 May, 2017) announced the temporary boost to the first home owner grant would stop on June 30, 2017. 

The boost, announced by the previous government in December 2016, increased the First Home Owners Grant (FHOG) payment from $10,000 to $15,000 on the purchases of new homes.

It had previously been scheduled to cease on December 31, 2017.

Shelter WA spokesman Stephen Hall said if the State government was serious about budget repair, together with long-term sustainable funding sources, it should move from taxing first home buyers with stamp duty to a broad-based land tax.

“The FHOG is meant to assist with housing affordability,” Mr Hall said.

“However, moving from stamp duty will be more effective for first and all home buyers.

“As WA’s population ages, this would be an effective response to support seniors to downsize, and free up housing stock throughout the State.

“Stamp duty has widely been recognised to have a detrimental impact on residential mobility, housing affordability and efficient use of the housing stock.

“Any move to a broad-based annual land tax will need to be phased-in to ensure those who have recently paid stamp duties aren’t unduly disadvantaged”

Mr Hall referred to a recent Australia Institute report about stamp duty calculations, on houses listed on, to demonstrate that on average, stamp duty adds an additional $31,700 to the cost of a house in Perth (The Australia Institute, 2016).

Media Contact:  Stephen Hall, Shelter WA Spokesman   

(08) 9325 6660 or 0499770 245 or 0408426 263

 17 May 2017