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Stamping out stamp duty is not enough to fix housing.



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DEMOCRATS MEDIA

STAMPING OUT STAMP DUTY IS NOT ENOUGH TO FIX HOUSING The Federal Government relies on blaming State Governments and stamp duty for the unaffordability of housing, the Australian Democrats said today.

Leader of the Democrats Senator Andrew Bartlett, said, "Even if stamp duty is removed or halved and in the unlikely event that housing prices don't go up as a result, median housing prices will still be out of reach for a large number of households. The figures speak for themselves."

For example, cutting stamp duty by half in Brisbane will save the purchaser mortgage payments of $7 a month on a median priced house. [1] But for at least half of all Brisbane households purchasing a home is impossibly expensive. A household on the median gross annual income of $41,036 would be paying 48.38% of their income on mortgage payments now and would pay 48.17% if stamp duty was cut in half.

"Any improvements in affordability are laughable when faced with a problem of this size," Senator Bartlett said.

The Prime Minister has indicated that he will call on States to reduce stamp duty at the meeting of Government Finance Ministers today.

Senator Bartlett said, "There is no doubt that housing affordability is getting worse and that the government has no idea what to do. The Federal

Government is merely avoiding the blame and trying to shift 100% of the problem onto the States.

"Both the Federal Government and the Opposition must take housing affordability seriously and move beyond rhetoric and blame. Unaffordable housing is a problem that won't fix itself and government has an important role in getting the settings right. A national housing strategy that looks at tax settings - including negative gearing and capital gains tax - and provides a means of delivering affordability for the home buyers and renters is needed," Senator Bartlett concluded.

Media Contact - Rowena Bew - 0400 729 555

[1] Assumptions: Mortgage is 80% of purchase price plus stamp duty; interest rates are 7.05% on a mortgage over 20 years; purchaser has a median Brisbane household income. Data sources: REIA, ABS Household Income and Income Distribution (Cat. No 6523.0) and Australian Democrats calculations.