Victoria's first-home buyer fund excludes dozens of towns

Dozens of towns in Victoria have been excluded from the state’s new first-home buyer fund, and agents in high-growth neighbourhoods are questioning why their areas have been forsaken.

Under the scheme, the Victorian government will cover a quarter of the cost of new homes in exchange for a share of the property. The program was launched to ease the costs of lenders mortgage insurance and reduce the amount of money needed for buyers to get on to the property market.

However, towns in high-growth areas near the Grampians and Surf Coast have been excluded from the fund, according to a report by NCA NewsWire. That’s not sitting well with real estate agents who say the exclusion is a blow to communities wanting to grow their economies.

Stawell agent Terry Monaghan told NCA NewsWire that property prices in the area had spiked nearly 33% during the pandemic – a sign that people wanted to buy in smaller areas outside the city.

“I don’t understand why some towns have been left off the list – it’s as though the government doesn’t want you to buy in Stawell, they’d rather people bought apartments in South Yarra,” Monaghan said. “The more people buy houses out here, the better the education, the better the health services we get. It’s a growth area and there’s a lot of people wanting workers, and we need people to come and be part of the area.”

Among the dozens of towns excluded from the program were Aireys Inlet, Stawell, Hamilton, Alexandria, Anglesa, Beaufort, Avoca and Charlton, NCA NewsWire reported.

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Monaghan told NCA NewsWire that after reaching out to the state revenue office for an explanation, he was told that locations were chosen to support purchases in “large population centres and medium-sized towns.”

That’s basically choosing to increase crowding in overpopulated cities rather than decentralising populations across smaller areas, Monaghan said.

“I don’t understand how the government can take tax from all the people in this area and give the money to someone who wants to buy a flat in Toorak,” he said. “I hope the government rethinks the whole situation. It is not correct. You can’t support one area against other areas – it’s basically wrong.”

Victorian Treasurer Tim Pallas said earlier this month that the program was “a very substantial step” toward helping people enter the property market.

But David Davis, leader of the opposition in the Legislative Council, said the government didn’t seem to care about Victorians who lived outside Melbourne, NCA NewsWire reported.

“The treasurer needs to step in immediately and admit he’s blundered,” Davis said. “He needs to open the fund to all eligible Victorians who meet the criteria, wherever they live. The Labor Party have dragged massive amounts of tax from families through stamp duty and have made the dream of homeownership increasingly unaffordable for Victorian families. It is a nasty, deliberate tactic to discriminate against some country people and families.”