REIQ blasts doubling of Qld first-homeowner grant

The REIQ has slammed the government’s doubling of the first-homeowner grant, dubbing it a “sugar hit” that will drive up construction costs.

Queensland’s peak real estate body has criticised the state government’s doubling of the first-homeowner grant as the “wrong lever” to pull to deal with the housing crisis, calling it a sugar hit that would drive up construction costs.

REIQ chief operating officer Dean Milton said it welcomed the “intent” to encourage more homeownership but would have preferred if the supply crunch was tackled head-on.

Referencing the former Coalition-government’s provably inflationary HomeBuilder scheme, Mr Milton said while grants at all levels were “great in theory”, it had created high demand and put pressure on building supplies and tradie availability.

“We generally support initiatives that give first-homebuyers a leg up towards home ownership; however, at a time when the RBA is doing its best to tame inflation, we question whether now is the right time for more demand side stimulus,’ he said.

REIQ chief operating officer Dean Milton.

“We know that South East Queensland alone requires in excess of 40,000 houses per annum and incentives on the demand side are unlikely to assist in delivering this target.

“Builders in Queensland are already facing the highest construction costs in the country and we would expect this measure to drive up those costs further.”

From November 20 until mid-2025, the first-homeowner grant will double from ­$15,000 to $30,000 in a bid to help about 12,000 people into new homes.

Mr Milton’s comments come after respected economist Saul Eslake criticised the policy, labelling claims it would not increase the price of properties and help free-up existing stock as “bulls---”.

Mr Eslake said Australia had 60 years of evidence that giving cash to homebuyers resulted in more expensive housing, not in more people owning their own home.

From November 20 until mid-2025, the first-homeowner grant will double from ­$15,000 to $30,000.

“It’s hard to think of a policy that governments have pursued for so long, in the face of such incontrovertible evidence that it doesn’t work, than the policy of giving cash to first home buyers in the belief that it increases the homeownership rate,” he said.

On Sunday, Treasurer Cameron Dick denied the policy was developed with one eye on the state election and insisted it would make the “great aspiration of homeownership” more achievable.

“This is about Queenslanders who want to buy first time and will never apologise for helping Queenslanders who want to get into the market,” he said.

“Homeownership is something that Queenslanders aspire to it helps generate wealth, create wealth for families and we are delighted to be able to support them in their own journey towards their own dreams.”