A sharp jump in the number of First Home Owner Grants signals a revenue windfall for the next WA Government, says industry, with the number of grants at levels not seen since before the global financial crisis in 2008.
The spike, revealed in the latest Treasury figures, mirrors other signs of recovery in the State's broader real estate market and comes as higher iron ore prices appear likely to boost WA's bottom line.
Most first-homeowners eligible for the $7000 grant do not add to the State's coffers through stamp duty on property transactions.
However, analysts consider them one of the main predictors of an upswing in future sales in the housing sector and in tax revenue.
The Treasury figures show First Home Owner Grants (FHOG) hit 4790 in the December quarter, the eighth consecutive quarterly rise.
They are now above their 2008 peak and almost 28 per cent above levels of a year ago, although they are still to reach the artificial highs set in 2009 when the Federal Government doubled the grant in an effort to stave off recession during the depths of the crisis.
Treasurer Troy Buswell said the higher activity would eventually filter into the State's finances, although he was hopeful the boost would be driven by an increase in the number of sales, rather than an inflationary lift in prices.
"The increase in grants shows notwithstanding the (tapering) of business investment . . . that consumption and household investment decisions will keep the domestic economy running along in positive growth territory," he said.
After signs of an improvement in the real estate market, Treasury lifted its forecasts for stamp duty on property transfers by $122 million in the December Mid Year Review.
Mr Buswell said that most related to some unforseen major commercial transactions but conceded any further upswing in the property market could pad the Government's bottom line. But shadow treasurer Ben Wyatt criticised the Government's handling of the economy, citing high rents and falling housing approvals - although a report by CommSec showed property finance was strong.
Offsetting this, research group Demographia yesterday said WA house prices remained high by international standards, potentially limiting price rises.Real Estate Institute of WA president David Airey said first-homebuyer activity was good for the entire market, because 75 per cent of them bought an existing dwelling. This meant existing owners could trade-up, creating more stamp duty revenue, he said.
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