National promises to double first-home buyer grants

National is promising to boost the grants offered to first-home buyers and builders.

The first-home buyers' grant, currently $10,000, would double to $20,000. The grant offered to builders would rise from $20,000 to $30,000.

National leader Bill English made the announcement at the Hobsonville development in Auckland, which is expected to provide 4,000 new homes when it is completed.

"In the last few years we've seen some real pressure in the housing market," he said on Sunday morning, flanked by high-ranking MPs Amy Adams and Jonathan Coleman, and National housing spokesperson Nick Smith.

"It's been a challenge for first-home buyers, it's put pressure on families that have been looking for the right kind of housing."

He said the Government has "attacked it from every angle we can find", and as a result fewer investors are getting loans, with a slight rise in first-time buyers.

The boosted grant would help a further 80,000 people into their first home over the next four years, National claims.

"Take a couple on the average wage in Auckland who have been in KiwiSaver for five years and are looking to buy their first home," Dr Smith said.

"Between the $20,000 HomeStart Grant and their KiwiSaver withdrawal, they will have around $60,000 for a deposit for an existing home. Add in a Government-backed Welcome Home Loan, which means they only need a 10 percent deposit, and they have enough for a house worth up to $600,000 - the Auckland HomeStart cap for existing homes - without needing other savings.

"That's significant support for those New Zealanders."

It would cost $74 million a year, and come into force from January 1, 2018.

Labour's housing spokesperson Phil Twyford said it was a "bandaid response to a crisis they have no answer to".

"Without dealing to supply, homebuyer subsidies risk driving prices higher," he wrote on Twitter.

Economist Bernard Hickey had similar views, citing Treasury's findings and Australian research that shows they only push prices higher.

Newshub.

Share to Facebook Share to Twitter Share to Email
Share to Facebook Share to Twitter Share to Viber Share to WhatsApp Share to Email