FHOG Boost - what will happen after 30 June 2009?

Bud Fox

Bud Fox

Hello all

First post so go easy on me.

I am in the process of subdividing some land and also going through the local council in getting a town planning permit. Once I have this, my architect will then be able to complete the construction drawings which will then enable me to enter into a 'comprehensive contractual agreement' with the builder in order for me to obtain the the 7K + 14K.

This contract is what is required for me to get my 21K

My big issue is that this date is likely to get pushed past June 30 2009, (most likely July, possibly August) and hence me not being able to obtain the 21K - which is a massive disappointment.

My only hope is that the gov't extends the FHOG 14K boost (i know many on this forum dont want this to happen for obvious reasons)

My question is - what is the likelihood that the Gov't will in fact continue the FHOG boost (for new dwellings) post June 30 2009???

Thanks
 
Hi there Bud welcome to the forum.

All you have here is everyone's opinion on it and really none of us knows.

My opinion: It will be extended because goodness knows what will happen to the only market that is driving the economy at the moment, if it isn't.

But that is merely my opinion.:)

regards JO
 
WinstonWolfe said:
What will you do if the bonus isn't extended?
Click to expand...

As an investor I'll go back into the market to buy without a bunch of crazies on a dead-line to spend money they didn't save and don't value as much as their own hard worked for money.
I'll put offers on the table to vendors that I know they won't like but some may be forced to accept because the bank is breathing down their neck and I won't go to bed at night while they consider it, wondering if I'm going to get gazumped by a FHB.
I'll go to OFI's and get sucked up to by REA's as I'm one of the few buyers they know is serious and can be relied upon to keep my word. REA's will actually call me back at the appointed time and tell me the property I inspected is still on the market and ask me if I would I like to make any offer, any offer at all.
Vendors will be more willing to give me vendor finance because I want to put no money into a deal and the banks will only give me 75 - 80% - just so they can sell their property.
For my clients that I buy for, I will actually be able to produce 3 - 4 property reports with my buy / no buy recommendations for them to consider which ones on the shortlist they like better. Then we can meet and devise a strategy to put offers or bid at auction..........rather than shoving said report into the post as a keep-sake after the event, because they already had to buy the property to beat an anxious FHB.
Somebody pinch me - am I dreaming?
 
Personally i never make an investment decision based on the expectation that something will continue to happen. But thats just me, investing is risky enough as it is without adding uncertain future variables and assuming they will continue.
 
Doesnt matter whole lot if the bonsu will be extended.

With the lenders and insurers sensibly running chicken because of concentration risk, the extra 7 k wont do much to make up for the lack of money at 90 % plus LVR.

Nor wil it fix the "back to the future" genuine savings requirements which looklike they will soon be mainsstream again. These were first knocked on the head back in late 2005.

My REA mates tell me that the flow through to the second tier market isnt really happening sd they expected, and I am seeing some anecdotal evidence that a lot of the vendors selling to FHBs are investors getting out, rather than OO people upgrading.

Be interesting to see some stats in 3 to 6mths as to the growth in new construction if any.

I dont see any +ve price pressue in my local turf on new land developments that are mid way between FHOG buyers and upgraders

ta
rolf
 
My REA mates tell me that the flow through to the second tier market isnt really happening sd they expected, and I am seeing some anecdotal evidence that a lot of the vendors selling to FHBs are investors getting out, rather than OO people upgrading.ROLF


Interesting what you said about your RE mates Rolf.
I would love to know what others are hearing about the expected transfer of activity from FHB to 2nd tier.
My local RE man told me 4 months ago that the industry was expecting this to happen. At the time, I was furiously preparing 2 properties for sale and wondered if I was doing the right thing.
:confused:
 
Bud Fox said:
Hello all

First post so go easy on me.

I am in the process of subdividing some land and also going through the local council in getting a town planning permit. Once I have this, my architect will then be able to complete the construction drawings which will then enable me to enter into a 'comprehensive contractual agreement' with the builder in order for me to obtain the the 7K + 14K.

This contract is what is required for me to get my 21K

My big issue is that this date is likely to get pushed past June 30 2009, (most likely July, possibly August) and hence me not being able to obtain the 21K - which is a massive disappointment.

My only hope is that the gov't extends the FHOG 14K boost (i know many on this forum dont want this to happen for obvious reasons)

My question is - what is the likelihood that the Gov't will in fact continue the FHOG boost (for new dwellings) post June 30 2009???

Thanks
Click to expand...

Hi Bud

Worst case scenario is you don't get the extra $7K. Ask the builder for a further $7K discount in this case and see what he says :)
 
GIDDO said:
I would love to know what others are hearing about the expected transfer of activity from FHB to 2nd tier.
:confused:
Click to expand...

The effect is not cascading upwards in Brissie outer northern burbs either GIDDO.

Two REAs I've known for over 20 years confirm.

And I track across time, house sale listings in several suburbs across several bands.
sub 300, 300-350, 350-450, 450-600

listings in higher bands are up.

lower bands were up Jan 08 to Oct 09, then fell significantly...though listings have been slowly creeping back up in the last 4-6 weeks.

need other info to confirm whether inceased supply or decreased demand.
 
WinstonWolfe said:
The effect is not cascading upwards in Brissie outer northern burbs either GIDDO.

Two REAs I've known for over 20 years confirm.

And I track across time, house sale listings in several suburbs across several bands.
sub 300, 300-350, 350-450, 450-600

listings in higher bands are up.

lower bands were up Jan 08 to Oct 09, then fell significantly...though listings have been slowly creeping back up in the last 4-6 weeks.

need other info to confirm whether inceased supply or decreased demand.
Click to expand...



Very interesting Winston,

I am interested in outer north Bris. Thanks.

I see this issue of "cascade" to be critical to how prices will go over the next few months. No cascade where you are looking.
No cascade up here either.

Who else has any info/opinions?:)
 
Rolf Latham said:
My REA mates tell me that the flow through to the second tier market isnt really happening sd they expected, and I am seeing some anecdotal evidence that a lot of the vendors selling to FHBs are investors getting out, rather than OO people upgrading.
Click to expand...

Have been going to OFIs with No 1 Daughter (who is 'shopping' for her first PPOR) and this is what we have been observing, too, Rolf. The 'lookers' seem to be mostly FHBs, with the odd builder here and there, and not much evidence of investors. Most of the properties we have inspected are obviously tenanted. The asking prices are 'very optimistic', IMHO, but the FHBs seem to be falling over themselves to pay the inflated prices.

As others have observed, with the tightening of finance and the initial rush of FHBs now slowing somewhat, I doubt that there would be much point in extending the FHOB (though I believe the FHOG will remain). But who knows???

Cheers
LynnH
 
Propertunity said:
As an investor I'll go back into the market to buy without a bunch of crazies on a dead-line to spend money they didn't save and don't value as much as their own hard worked for money.
I'll put offers on the table to vendors that I know they won't like but some may be forced to accept because the bank is breathing down their neck and I won't go to bed at night while they consider it, wondering if I'm going to get gazumped by a FHB.
I'll go to OFI's and get sucked up to by REA's as I'm one of the few buyers they know is serious and can be relied upon to keep my word. REA's will actually call me back at the appointed time and tell me the property I inspected is still on the market and ask me if I would I like to make any offer, any offer at all.
Vendors will be more willing to give me vendor finance because I want to put no money into a deal and the banks will only give me 75 - 80% - just so they can sell their property.
For my clients that I buy for, I will actually be able to produce 3 - 4 property reports with my buy / no buy recommendations for them to consider which ones on the shortlist they like better. Then we can meet and devise a strategy to put offers or bid at auction..........rather than shoving said report into the post as a keep-sake after the event, because they already had to buy the property to beat an anxious FHB.
Somebody pinch me - am I dreaming?
Click to expand...

Hi, Propertunity

I had to mentally pinch myself just to keep from getting too 'aroused' :eek: by your post. Almost felt like what you said might actually come true! :p

Regards
Daniel Lee
 
for me it will stay
not sure if it will increase but stay I think
there are a couple of developers giving the same if not more so instead of 21k its 42k
so they are even fueling more.
yes its a false increase but then isn't alot of things
my bigger questions is even simpler
what happens when the cupboard of freebees runs out.
these people are going to be hit for six unless they have used the fhog to buy a property that can take a increase in rates
and don't say rates won't move
I hope they don't as I like low rates but the could,would,can ,might, will and some say should and anything in between.
will mr rudd cancell them not likely
why hes the guy int he pub handing out free money.
he's the guy that come in and says drinks are on me.
you do that and you can have two heads and you still will be the most popular guy in the pub and get a few girls to like you until the money runs out
looking at the polls the same reason he's so popular.
so do you cancel something that make you popular.
no way.
for get the problem
if the demand driven by fhog increases prices thats fine
just give em more money thats the trick.
forget about supply and demand
just give em more grants and it will sort its self out.
for me the only chance of it being cancelled it theat the reserves says sorry guys we have no more cash
like the atm saying the guy in the pub your out of cash.
trouble is not sure if the reserve is going to tell mr rudd and mr swan we are running out of cash.
but he's a nice guy so the polls say
 
I have been thinking about this question and I wonder whether the market will continue to be stimulated regardless of what happens but by investors rather than FHB.

There seem to be an awful lots of investors, even on this forum who are currently still not jumping in because they don't want to compete with the FHB so if the grant doesn't continue in its current form and the FHB back off perhaps these investors will jump in from July.

On the other hand if the grant continues and the FHB activity doesn't slow down will investors who have been sitting on their hands think its time to jump in even if they do have to compete as if they keep on waiting they might miss out on whats left of the cheaper properties/best buys?
 
Forgot to say also that there would have to be a lot of people upset with the new low interest rates on their savings, as low as 1 1/2% with some banks.

Surely they would also be moving their cash into property and shares?
 
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