Real Estate Industry of Western Australia chairman and Realty Executive licensee Roslyn Ierace said that the removal of the grant would be detrimental to the housing market.

“First home buyers have always been a big part of the market and if the grant is removed it will create a roll on effect of people not buying,” she said.

Currently First Home buyers can receive $7,000 towards a deposit and no stamp duty from the government.

Veteran economist Saul Eslake said the grant was increasing house prices.

Mrs Ierace said these claims are part of a scare campaign.

“It is absolute rubbish, sellers do not know if potential buyers are first home buyers and if sellers are not realistic about their price then they won’t sell their house,” she said.

At the moment there are 300 houses in the Greater Bunbury area that are on the market for $300,000 and under, which include newly built properties Mrs Ieraci said.

She said that this demonstrates that the grant does not have an effect on housing prices.