WHEN Keiran Taylor and his fiancee started looking to buy their first home early last year, the couple had their hearts set on buying an older home and making it their own.
But the state government’s decision to scrap the $7000 first-home owner grant for existing homes and stamp duty concessions last October put their plans on hold.
Instead, the old scheme was replaced with a $15,000 handout for newly constructed homes only, which will be downgraded to $10,000 at the start of next year.
The policy change was designed to encourage home owners to build or buy new homes to kick-start the building industry.
But figures released this week show only 1383 first-home owner loans were taken out in the month after the grant was scrapped - the lowest level in 20 years - compared with 2088 loans in October.
Despite missing out on the grant, the couple decided to stick with their original plans and paid a deposit on a 1960s-era home in December.
Without the helping hand they were forced to wait longer and save more money before they could dive into the home market.
“We did consider a new house, but to do so we would have had to borrow more money,” Mr Taylor said.
“Our mortgage repayments in the long run would have been higher.”
Mr Taylor said the lure of the $15,000 grant did not outweigh the extra time the couple would have had to wait to build a home and most newer homes were outside their budget.
John Cook Real Estate’s Anthony Cook said there was still interest from first-home buyers in Orange, despite last year’s changes, but the number of house sales and the median prices had dropped.
“[First-home buyers] were looking at $400,000 to $450,000,” he said.
“Now it’s a little bit less of a hot market so it gives them the time to make a decision.”
He said the grant for new homes had not deterred first-home buyers from existing homes, with the extra $15,000 doing little to help out when a new home could cost $100,000 more than an old home.
“Most people look for homes that suit them,” he said.
“We’ve got a few new homes ready to go. The home owners grant still makes it possible for young people to get in the market.”
Mr Cook doubts the changes to the grant will impact on the amount of time it takes for existing homes to sell, with homes usually staying on the market for an average of 102 days in Orange.
He said the Orange market remained strong with interest from investors as well as first-home buyers.