In today's Herald:
Under the Howard government house prices reached unsustainable levels, exacerbated by the first-home owners grant and negative gearing - both designed to help people buy houses, but which ended up overheating the market.The bit that is struck through was a part of the letter that did not get published. Now I look like someone who thinks that Australia's housing problem is not part of the global problem. Oh well.
To be sure, unsustainable house prices are a global problem and Australia is no exception. Nevertheless it is essential that government at all levels follow common sense policies to cool down the housing market.
The Rudd Government's decision to offer tax breaks to first-home buyers is, sadly, another attempt to curry favour among home owners while pursuing inflationary policies.
Government should have no business either helping or hindering the housing market through subsidies and tax dodges. If Mr Rudd wants to give back some of the surplus, he should raise the tax-free threshold by a modest amount, rather than throwing money at a market that is heading for a meltdown.
Neil Cameron Waratah