First Home Owner’s Grant is an Illusion

Australia has a wonderful bonus for anyone who emigrates to Australia, not only are the beaches as good as they looked on “Bondi Rescue” but if you decide to buy you own piece of Australia the government will give you money!

Free Money?

Any one who is a permanent migrant or citizen in Australia and who has not owned a home before and is looking to buy a property is eligible for the first home buyer’s grant which has just been generously doubled by the Federal Government to A$14,000. If you are planning on building the news is even better, the grant is A$21,000. Nice: free money - its rare so grab it now!

Well surprising enough there is a downside. New figures just released notes the interesting fact that local Council taxes can add an additional $21,000 on the $150,000 construction cost of a entry-level basic house. Now these are costs on top of the Federal and State government regulations to ensure that buildings are healthy and sanitary. The Council regulations are about, well political correctness and pseudo-green concerns. Rules include requirements for larger rooms and balconies, access for disabled people and water saving devices. A report by the Australian Building Codes Board refuses to actually name the Councils responsible but they are all in metropolitan areas, with five in NSW, one in Western Australia and one in South Australia.

This is of course political correctness gone crazy. Yes its important to have building regulations which ensure that waste and clean water don’t mix or that the gutters remove water from roof and not flood the basement. But most home buyers are aware of that a room is too small or a balcony not big enough: hint if you can’t open the door to the balcony with a flower pot on it the balcony is too small! If you don’t care that’s OK, because think if the $150,000 house was only $!39,000, even though the third bedroom is a study and the balcony too small maybe some people will think that’s an OK compromise for a first home!

On one hand we decry the carbon foot print of people in countries such as Australia, then we turn around and insist houses have to be even bigger, cost more to build and to cool and heat, not to mention furnish and decorate.    We are at least two generations away from children sharing bedrooms, now it seems that little Jonny’s bedroom must be a double with an en-suite! And working parents wonder why they have no time: they are too busy working to pay the bigger than necessary mortgage and then vacuuming all the extra square footage these nannie-regulations require.

Actually its even worse than this: even if you don’t decide to buy in the wrong Council’s patch most State government will hit you for at least A$5,000 sales tax: just for buying a property.  Not only is there no free money in Australia: you will paying quite a lot extra in taxes too.

Photo credit: j-fin