Last week, several newspapers ran a story in which the Labor Opposition criticised the New South Wales Liberal government because the number of first home buyers had plunged after the first home owner’s grant was ended for existing homes. A photo of acting Opposition leader Linda Burney looking out sternly and sincerely accompanied the article, as she intoned in The Sydney Morning Herald’s text that the Liberals had abandoned first home buyers:
“The acting Opposition Leader, Linda Burney, said this decision and the axing of stamp duty exemptions for first home buyers of existing homes from December 31, 2011, meant the New South Wales government had ‘abandoned first home buyers’.
“‘These figures clearly show [Premier] Barry O’Farrell has locked first home buyers out of the property market with his cuts to stamp duty exemptions and first home buyer bonuses,” she said. ”The worst loan approvals for first home buyers in 20 years should be a wake-up call for the O’Farrell government. Their approach clearly isn’t working’.”
What bollocks. First home buyers weren’t locked out by the ending of the first home vendors’ grant: they were locked out by the impossibly high prices that this grant has helped generate over the 30 years since it was first invented. And its purpose has never been to give first home buyers a helping hand: it has always been used as a way of giving the economy the economic equivalent of a steroid injection. First home buyers have instead been the sacrificial lambs of an asset-price-inflation route to apparent national prosperity.