Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Fightback maintains housing affordability

Download PDFDownload PDF

Media Release Geoff Prosser M.P. FEDERAL MEMBER FOR FORREST

S hadow M inister for Small Business, Housing and Customs.


Housing affordability will be improved under the Coalition's Fightback strategy, the Federal Shadow Minster for Housing, Geoff Prosser, said today.

"The Coalition has had an on-going commitment to encourage and facilitate home ownership. We have retained this commitment in Fightback by making special provision to safeguard the capacity of Australians to purchase their own home.

"To this end, we have not applied GST to the final sale price of new housing. Instead only building materials and products used in the development of land and the construction of housing will be input taxed. No tax will apply to established homes or rent. "Effectively, the builders margin and labour costs (including sub-contract labour), which account for about 50% of the total house cost, will be tax-free.

"Estimates provided by the Housing Industry Association (HIA) indicate that the purchase price of an average house and land package of $120,000 would increase by around $2,800.

"However, the Coalition will offset this increase by providing a grant of $2,000 to all first home buyers. In addition, the higher disposable income resulting from the significant cuts in income taxes will enable households to meet mortgage repayments on the balance ($800 using the HIA example).

"Given the size of the Coalition's tax cuts it is entirely possible that housing affordability would improve for a large number of households."

Mr Prosser said that first home buyers would gain further benefits from the Coalition's decision to allow them access to superannuation as a deposit or part deposit on a home.

"Access of up to 75% of vested superannuation funds for a deposit on a house will, for many households, reduce the amount they need to borrow to buy a home. Lower interest bills and smaller mortgage repayments will further enhance housing affordability and allow a greater number of young families to move into their own

home." _



The housing initiatives contained in FightbackwlW also provide a boost to building and construction industry.

"Falls in unemployment coupled with improved affordability will result in an increase in the demand for housing. This will be of significant benefit to the building and construction industry, who continue to suffer the effects of the worst recession in sixty years.

ends Canberra

27 November 1991

. 2 .

For further information: Geoff Prosser (06) 277 4717

Karen Kuschert (06) 277 4717 (06) 286 5006(h)