House prices in Queensland will jump when the first home owners grant expires this month and a new land tax is introduced, industry experts say.
The state government is pulling the plug on the $20,000 payment two years after it was increased from $15,000, Tuesday’s budget shows.
Housing Industry Association (Queensland) executive director Warwick Temby said there was nothing in the budget promoting affordability when the industry is turning down and migration into the state is petering out.
“We need supportive policies to help people into housing, not policies that are going to put up prices, and that’s what this is going to do,” he said.
Mr Temby said regional Queenslanders will be hit hardest by the loss of the grant because it meant more in areas where houses cost less.
“This is probably the worst time to be taking that little bit of incentive away,” he added.
Paul Bidwell, Master Builders Association Queensland’s deputy chief executive, said the number of first-time buyers entering the market had spiked after the payment was brought in.
“First home owners are now a big part of the housing market and the boost will make or break some, so it will be the difference between whether a first home owner gets to buy a new home or not,” he said.
The land tax applies to about 850 holdings, not including farms, and is one of five new tariffs the state government will introduce to help pay down a ballooning debt.