The Big Lie About First Homeowner Grants…

In recent years we have seen a swathe of “initiatives” from state and federal governments with the aim to encouraging and helping more first-time buyers into the housing market. The previous Government claimed they had helped “hundreds of thousands” into the property market.

The latest ABS statistics shows that the number of First Time Buyers is falling again – and the part peaks map directly onto Government “stimulus” measures.

The latest is the Albanese Government release of 40,000 new places under the Federal Government’s Home Guarantee Scheme, which will enable eligible first home buyers to purchase a property with a deposit of as little as 2% or 5%.

This as a time when the Reserve Bank of Australia is aggressively increasing rates and house prices are expected to plunge by between 10% and 20%, depending on the forecast. What could possibly go wrong?

In fact, the evidence suggest that these schemes are ineffective. Indeed, the long-term trends in terms of home ownership shows that across Australia, a smaller proportion of people own their own home, and those that do have bigger mortgages for longer. The latest Census data, which is still in the process of being released continues to confirm this trend.

Home ownership rates in Australia have declined over several decades, and the likelihood of attaining home ownership by age 30 has fallen substantially. Go back two decades and the average age of a first time buyer was 27 year, today its 34 years and rising based on my surveys. In addition, especially in Sydney, Melbourne and Perth, first home buyers (FHBs) are now buying fewer houses and more units, and evidence shows that more are receiving parental assistance.

Also while mortgage repayment affordability stress has been cushioned by falling interest rates until 2022, mortgage deposit requirements have risen with prices and become an increasingly serious constraint—far more so in Sydney and Melbourne than elsewhere.

I have long argued that this First Home Owner grants are bribes which distort the market, lift prices and are more designed to assist the construction sector. In other words, First Time Buyer Grants are a con.

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Caveat Emptor! Note: this is NOT financial or property advice!!

Written by Walk The World


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  1. Lol. Over the last 20 years it has been interesting to observe various monetary systems flaws, faults and failures I'd admit.
    The different ways manipulation has become used to various doctrine, how old or outdated ideological views become increasely irrelevant and to the stand points in disruption and how to and do so as latency comes to the fore is something and can also take effect, I definitely admit is useful.
    And I definitely am Not the only one that's for sure in future

  2. Propping up the real estate was the biggest idea behind what has happened in last two years. The kind of money printed to distribute, and bail out is mind blowing

  3. Looking back 23 year's when interest rates were %5 and My first house was 100K So tell Me why house prices are so High?Back then I saved and worked and bought a house with no first home buyer grant so all this medalling has wrecked it for every one and all those who bought investment properties to make a profit it was just really bad that has brought all of Us to this.
    Ask Old Bean He will tell You and Eldrad Must Live.

  4. These schemes are unconscionable. Your assessment of these grants is lucid and compelling. The trouble is these Pied Piper Schemes gather willing participants regardless of where they are being led. $20 billion spent, what a disgusting subsidy to the boomer bourgeoisie.

    Well done Mr. North, commendable presentation. You could help those who like to read by putting a link to the reports your discussing in the show notes. Anything to save a Google search.

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