The damage is done
By ADRIAN MILLER
NSW Premier Morris Iemma's decision to scrap the unpopular vendor tax may have come too late, according to a local builder.
Rob Connolly Constructions manager Paul Pridham said while the abolition of the tax was a good move, the damage it caused could be irreversible.
"I can only see it as a positive move, the only thing that worries me is that he's missed the boat and it's come too late," Mr Pridham said.
"I'm just worried that a lot of money has already gone to Queensland because of it."
Mr Iemma announced on Tuesday that the vendor duty would no longer apply to investment properties where contracts were exchanged on or after August 2.
"This is not a decision I have taken lightly, but the vendor duty was introduced in a very different property market and it is not helpful in current market conditions," he said.
LJ Hooker Yamba principal Simon Dougherty said the introduction of the tax was a poor decision by the Carr government and had negatively impacted the property market.
"It's probably fair to say at the timing of the introduction the property market was declining, but they (Carr government) just gave it a kick in the balls on the way down," he said.
Mr Dougherty said many investors would be enticed back to the area now the tax was gone.
"People who'd previously weighed it up and thought it'd be better to go over the border to Queensland will be back looking, so it will put us back on a level playing field," he said.
Yamba Properties manager Greg Bates said the removal of the tax would be music to the ears of smaller investors.
"The tax really hurt the mum and dad investors," he said.
"If they went and bought a property, and spent a few years doing it up and putting money into it, and then sold it, the vendor tax really slugged them and took all the incentive out of making that investment."
Mr Bates said while the removal of the vendor duty was constructive, it would take time to filter through.
"It will take a little while for the decision to kick-start the market, and the Government still needs to make some changes, such as the land tax issue, but this is the best thing to happen in a long while," he said.
But while investors are happy with Mr Iemma's decision, the Council of Social Service of NSW said more needed to be done on the North Coast to help families afford housing.
"It is clear that a boost to property investment in NSW must be accompanied by measures to reduce housing inequality in NSW and to ensure that we have good social mix in the communities being targeted for population growth," director Gary Moore said.