Instead, you now get a boosted "New Home Buyer's" Grant (only for new properties).
They've also changed the way Stamp Duty exemptions work, and now anyone buying a PPOR is able to claim a reduction in stamp duty up to $500K I think, rather than only being available to first time buyers.
The federal grant is still there, but as it's up to the states to administer it, it ultimately comes down to the states to determine which first home owners get it.
Overall I see the grant going more and more to new homes rather than established. The general government consensis is that new homes help keep prices down by increasing supply (perhaps they should also consider dropping the government costs of development).
It is possible that state governments will want to give incentives to all new home owers again and the grant will be given to all first home buyers. I think the more likely scenario is that other states will follow the lead of QLD & NSW and also restrict the grant to new homes. At this point the Federal government may take the opportunity to drop the grant altogether and let the states fund it. Eventually the states would then drop it entirely.
In many respects there's been a lot of political preasure for the Federal government to drop the first home owner grant, but there's also been preasure to keep it. This could be a pathway to getting rid of it entirely without too much Federal political fallout.
I don't think it's a big deal in any case. $7000 is nice, but it's a drop in the ocean compared to the average house price these days.