New government incentives for first-home buyers could create mini-boom in prices: Selling Houses Australia’s Andrew Winter

First-home buyers who wait until a government incentive is introduced or even change the type of property they are buying to fit in with an incentive requirement could end up paying a lot more, according to celebrity property adviser Andrew Winter.

Winter, the host of Selling Houses Australia, says the $15,000 incentive for new home purchases introduced last week in Queensland and to begin in NSW on October 1 has the potential to create a “mini local property boom”.

Writing in the weekend News Ltd papers, Winter says when an incentive is withdrawn buyers rush to beat the cut-off date while sellers race to list.

Conversely, when the date for a new incentive is announced, buyers wait until the time they can get their hands on government dollars, creating a scenario where buyers outnumber sellers.

Winter says the golden rule to buying well is timing, which means avoiding boom conditions “such as times when there are far more buyers than sellers”.

“Those vendors with time on their hands sit and wait to pounce on those newly cashed-up buyers, meaning prices often rise.

“My advice is to buy when you are ready, buy what you want, do you research and then review the incentive game,” says Winter.

“Unlike any other purchase, no house or unit ever comes with a genuine fixed recommended retail price, so a $15,000 handout has little value if you could have secured the home for $30,000 less a month ago.”

Despite the warning, Winter says the biggest beneficiaries of government incentives appear to be first-home buyers (who can access the additional funds) and investors (who can push up their selling prices).

However, the losers are sellers who have to sell at a time when buyers pull back from the market, while state governments also apperar to give no thought to home owners “struggling in a trade-up or trade-down scenario”.