New homes in Australia come gift-wrapped for Kiwis

By GREG ANSLEY

CANBERRA - New Zealanders moving across the Tasman can buy a house in the suburbs with a gift of up to $A14,000 (S16,935) from Australian taxpayers.

While Kiwis may not be quite as welcome as before under the new social security agreement, the rules of permanent residency required for welfare benefits do not apply to first-time home-buyers.

In fact, the conditions under which federally funded first home owner grants were originally allocated were specifically changed to allow New Zealanders to take advantage of the scheme.

And even the Labour Opposition, usually quick to hammer taxpayer-funded hand-outs, has defended the provision against speculation it could become a handout to Kiwi millionaires and sharp-eyed investors.

Nobody has yet actually discovered a single instance where this has happened, a spokesman for Shadow Treasurer Simon Crean said.

The federally funded scheme was launched in July last year as compensation for the impact of the new GST on house prices, offering a $A7000 ($8467) grant to Australians, or people with permanent residency visas, who have not previously owned property in Australia.

Shortly after it was announced, Federal Assistant Treasurer Senator Rod Kemp wrote to the States, which administer the scheme for Canberra, pointing out inequities in the scheme.

New Zealanders do not require visas to live permanently in Australia, technically disqualifying them from the original requirements.

The States agreed with Senator Kemp that the rules should be changed to allow Kiwis to receive the grant.

The Government has since doubled the grant to $A14,000 for people building new homes in a bid to prop up the housing industry, which nose-dived after a pre-GST boom, hammering employment and hauling back economic growth. The extra $A7000 will be available until the end of the year.

Rules for grants are tight. In addition to not previously owning property in Australia, applicants must move into the house they have bought within 12 months and are not able to rent it for that period.

While New Zealanders do have one advantage over other migrants - they do not need to wait two years for permanent residency - there is little scope for ripping off the system.