Budget 2009: First home owner grant extended for three months

The Government has extended the deadline of the increased first home owner grants to help boost the property market and stimulate the economy in a move that is assured a hearty welcome from the industry.

But the grants, which currently stand at $14,000 for established homes and $21,000 for new homes, will only be extended at the current level for three months.

The grants will remain the same between 1 July and 30 September, but between 1 October and 31 December 2009 eligible first home buyers will receive just $10,500 for established homes and $14,000 for newly constructed homes.

Federal Treasurer Wayne Swan said the grants were a success, and helped the property market survive tough economic conditions.

The extension will be welcomed by property experts, many of whom have praised the increased first home owner grant for propping up affordable housing while higher-end houses have fallen in value.

Tim Lawless from RP Data and David Green-Morgan from DTZ Research have both said the boost has helped the Australian property market survive drastic falls seen in countries such as the United States.

Enzo Raimondo, chief executive of the Real Estate Industry of Victoria, has also praised the grant.

But analysts are uncertain as to how the market will survive when the boost is diminished, and eventually scrapped.

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