Homes and jobs should be at the forefront of issues tackled in this year’s federal budget, according to the Real Estate Institute of Australia.

REIA president Hayden Groves made several requests to the government ahead of this year’s federal budget and put forward three ‘simple’ recommendations to grow Australia’s homes and job markets.

Mr Groves urged the federal government to help first home buyers, unlock supply, and create jobs in property.

Give first home buyers a hand

The REIA has called for an expansion to the First Home Loan Deposit Scheme (FHLDS) and the First Home Super Saver Scheme (FHSSS).

Mr Groves said, “we have seen a dramatic reduction of loans to first home buyers with a staggering fall of 21.5 per cent over 2021, reinforcing the need for governments to address both housing supply and affordability for first-time buyers”.

The REIA has also renewed calls to make interest rates tax-deductible for first home buyers – even if it’s only for a prescribed loan period – as is already the case for property investors.

“It’s one thing to achieve a deposit, and another to service a loan in an environment as interest rates rise – something we have not seen in Australia for over 10 years. We need to put in place fair and sensible recommendations to assist Australians coming into the marketplace,” he said.

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Create a national plan

Mr Groves said a national plan for housing supply and affordability was needed, arguing such a move was “badly needed” in the current market conditions.

“Politicians cannot talk about affordability without talking about supply,” he conceded. Mr Groves acknowledged affordability was at its worst point since 2008 – when 45.8 per cent of a family’s income was required to meet mortgage repayments.

The proportion of income required to meet loan repayments today is 36.2 per cent nationally – while median house prices push towards $1 million across Australia’s capital cities.

It’s an issue worsened by stock levels or property available for sale being reduced by up to 40 per cent from pre-pandemic levels in some areas, Mr Groves said.

“Coinciding with this is a lack of rental supply which has seen vacancy rates hit critically low levels of under 1.0 per cent,” he said.

That means rents are increasing, and those needing to rent properties struggle to secure a lease.

Mr Groves argued a need for a plan to unlock supply for both buyers and renters that looks at everything from land release planning to incentivising more rental stock coming online, as well as a national plan to phase out stamp duty.

“Stamp duty has made selling and buying a home prohibitive which has contributed to a long-term downward trend for listings,” he said.

Create more jobs in property

The REIA has asked the federal government to help unlock jobs in the real estate profession, acknowledging it as “an important part of Australia’s economy.”

Mr Groves has urged the government to allocate reskilling program money to a dedicated property manager mentorship program. The REIA stated that the real estate profession hasn’t been immune to COVID-19 induced retention issued, with more than 4,5000 vacancies still to be filed across Australia.

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