First home buyers cheating to get extra grant money

First home buyers are allegedly forward dating contracts to illegally claim the boosted first-home grant.

Some dodgy real estate agents and mortgage brokers are encouraging the fraud, suggesting buyers change the date of existing contracts to fall after October 14 so they qualify for the latest lucrative federal government grants.

Forward-dating contracts could net first-home buyers $14,000 instead of $7000 under the old grant system.

And several home loan lenders are reporting a 25 per cent surge in Victorian mortgage sales since the Government doubled the grant a month ago.

Australian Finance Group, which controls about 10 per cent of the national mortgage market, said a surge in first-home buyers saw Victorian mortgage sales soar by 25.1 per cent in October for the group.

With house sales drying up as the global financial crisis hit home, developers had slowed building new homes until there are signs of a recovery, which seems to be tricling throught now.

Nick Collishaw, head of Mirvac, a major Australian residential developer, said some of its projects had been put on hold for three to six months. But a fortnight ago it sold 36 homes, mostly to first-home buyers, compared with 15 the week before. This suggests a dramic turn of events.

The grant increase has sparked a sales boom in regional Victoria, where land prices are sill effectively low.

Villawood [a Queensland company operating in Victoria that Rick used to work for] have sales sales at the company’s Bendigo estates skyrocketing 300 per cent in the kast month.

The signs are that the first home owners grant has started to kick in and will be a major driver in 2009 for new home sales.