I’m fuming. After the financial catastrophe of divorce several years ago, I’m trying to get back into the housing market.

I’ve found a beaut little place that I can afford, but I’ve done this once before, so I know that a mortgage is like a marriage in one very real way – decide in haste, repent at leisure.

The problem is I am bidding against young, inexperienced buyers with $14,000 from the federal government’s first-home-buyers grant in their pockets, being hurried and harried into purchases that they cannot truly afford by (some) real estate agents and by the artificial cut-off date for the grant of June 30, this year.

If they don’t get their house before that arbitrary date, the $14,000 vanishes; or $21,000 if they build a new home. Then add the other $5000 or $7000 that most state governments offer first-home buyers, and the $10,000 cash-back deals from some developers.

The fact that these grants have pushed up prices isn’t really on their inexpert minds.

Sure, I got my grant of $7000 back when I bought a place. But I thought it was bad policy then and I think it is bad policy now.

The first-home-owners grant was introduced by the Howard government in 2000, just in case home-price inflation benefit to the people to smooth over the introduction of the GST back the 10 per cent tax dampened demand.

Instead, the grant caused another mad flurry of and entrenched a policy that provides the least it is supposed to help – first-home buyers.
It should be called the home-vendors bonus.

Low interest rates, tax policy and government handouts have pushed home prices to absurd levels in Australia.

But every time market forces threaten to actually drive prices down enough for people like me to afford to get into the market, the government intervenes to prop up prices.

Why? Because most voters have mortgages, and they are used to the value of their homes growing in leaps and bounds – not going backwards.

The reality is the house prices are decided not by the market, but by the value of those votes.