I am perpetually amazed at how the government (and the media) flog their "first home buyer" products. ie the "first home buyer grant" and the "first home buyer savings account". Am i missing something or are both of these really stupid?
I would have though that it would be obvious that any extra cash available to all first home buyers is going to pretty quickly get priced into houses at the bottom end, so in reality we are not any better off it just props up the prices of existing home owners. I think they need to be more honest that it is about protecting the house value of existing home owners, and potentially fueling a dangerous bubble. If they want to give first home buyers a leg up (which i think they should) why not give us stamp duty concessions in comparison to second home owners? this would have a similar affect without being inflationary.
Now the first home buyers savings account is simple patronizing and plain crazy. The long and bizarre list of requirements makes this account completely useless to anyone except people with no financial management skills. They force you to have your money in the account for 4 years and then buy a house and only a house, if you breach either the money goes to super. Both of these are ridiculous, what if you want to buy after three years?, what if your relationship breaks down?, what if you lose you job and want to use the money to live on?. Not to mention the fact that interest rates on these accounts are less than the nominal because they cost money to administer unlike normal bank savings accounts.
Add in fuel watch and grocery watch and Kevin Rudd has totally lost my vote.