Radio Interview with Melinda James – ABC Illawarra – Friday 25 March 2022




SUBJECTS: Labor’s Regional First Home Buyer Support Scheme; Labor’s Housing Australia Future Fund. 

MELINDA JAMES, HOST: We’re talking about house prices up next and Labor has a scheme, the Regional First Home Buyer Support Scheme that they’re putting out for discussion in the lead up to the election campaign, and to discuss it and announce it, Jason Clare, the Shadow Minister for Housing and Homelessness, will be in our region today with Anthony Albanese, the Opposition Leader. Jason Clare joins me now. Jason Clare, good morning.


JAMES: Look, tell us. This Regional First Home Buyer Support Scheme. How is this different to any other first homebuyer support that’s out there at the moment?

CLARE: It’s expanding what the federal government’s already doing. It’s going to triple the number, of young people in particular, it helps to buy a first home and buy it sooner. In the last 12 months, we’ve seen prices skyrocket in the Illawarra and right across the country, but in regional Australia in particular.  In capital cities, we’ve seen prices rise on average by about 21 per cent. In the Illawarra they’ve gone up by 30 per cent and that’s pretty much the norm in many parts of regional Australia. So, you’ve got a lot of young people who’ve been working hard, saving hard, saving a deposit hoping to get to that 20 per cent deposit to be able to buy a house and just seeing the prices go out of their reach, or mean that that twenty per cent deposit is now more like 10 or 15. What this scheme is designed to do is if you’ve got a five per cent deposit, the government will guarantee the next 15 per cent taking you up to 20 per cent so that you don’t get slugged with mortgage insurance when you go to sign that mortgage. Mortgage insurance, for people who haven’t had to pay it, is one of those big awful bills that you get when you sign up for a mortgage that can cost 20 or sometimes $30,000. So, it’s designed to avoid that bill, to provide that guarantee and help people who are saving up that deposit to buy their home sooner.

JAMES: Now to qualify for this scheme what are the criteria? You have to be what a first home buyer? Is Wollongong included as a regional area for the purposes of this is it?

CLARE: You bet it is. Yes, big time. It’s for single people earning up to $125,000 a year or couples earning less than $200,000 a year, and it’s designed to help you to buy a property worth $800,000 a year or less. But let me make this point that Melinda, we’ve seen as prices go up that the price caps that have been set for the government’s existing scheme come under pressure. So, I am also making the point today that if we win the election, we’ll review those price caps when we first come to office if we win the election, and then on a six monthly basis to make sure that the price caps are set at a level that makes sure the first home buyers can access the scheme.

JAMES: Some criticisms that are leveled at first homebuyers schemes, however they happen to be structured, is that they sometimes have the unintended and opposite to the desired effect of actually boosting prices even more and causing more inflation in terms of property prices. Do you think this scheme has the potential to do that?

CLARE: It’s a good question and the existing scheme was reviewed in the second half of last year and it didn’t find that it did that.  Just to put it in perspective, 600,000 homes are bought and sold every year in Australia. This is a scheme that is designed to help 10,000 people in regional Australia. It’s pretty targeted. What’s been pushing house prices up is a number of things. One, low interest rates at emergency levels over the last few years, but also people moving from the cities to the regions. What this policy is about is just trying to help level the playing field for first home buyers by getting rid of that big bill that you get when you when you sign up for a mortgage, and helping you to buy it sooner. So you don’t have to save as much, you don’t have to rent for another couple of years while you’re saving up, and as I said, you don’t get that big insurance bill at the end of it.

JAMES: Now here on the text, I remember when we last had you on the program, we did talk about tax reform. Jerry on the text, he says “why don’t we limit the number of negatively geared properties to one per individual?”. For starters, I know Labor has said that we took this to the election and it was not taken up by the voting public but yet poll after poll shows that many people are insisting on some change along these lines in relation to negative gearing, capital gains. I mean, I know Labor has abandoned this once and for all and for good. Is that right?

CLARE: I remember our chat Melinda a couple of months ago where we talked about it. Look, we took it to the last two elections. We lost. One of the things we identified out of the review of the last two elections, that it was something that people were concerned about. So we’re not taking it to this election but the problem still exists, the problem of helping young people to buy their first time still exists.  And that’s what this policy is designed to address. But there’s no easy fix here. There’s no one single thing that’s going to help to fix the housing crisis that we’ve got in Australia and that is a crisis years in the making. This is one of the things that will help, particularly young Aussies, who live in the regions. But there’s other things we’ve got to do as well. When I was last on your program in November, we talked about the $10 billion Housing Australia Future Fund that will build 30,000 social housing homes and affordable homes, in particular for women and kids fleeing domestic violence. We’ll also establish, if we win the next election, and develop a National Housing and Homelessness Plan. It’s something that everybody who’s looked at the housing crisis says we need to do. And over the course of the next few weeks, we’ll also set out a number of other policies designed to make it easier for people to buy a home, particularly in the suburbs. Albo talks constantly about making sure that no one’s left behind and no one’s held back. That Housing Australia Future Fund, building all that social housing, that’s designed to make sure that no one’s left behind. And policies like the one that we’re announcing in the Illawarra today are all about trying to make sure that no one’s held back. The people who aspire to own their own home but are struggling to save that deposit, we can make it easier for them to buy their first home and the Illawarra or in other parts of regional Australia.

JAMES: Jason Clare, I will have to leave it there. Thanks very much for your time.