The housing industry has backed Chief Minister Andrew Barr's call for all jurisdictions to abolish stamp duty, but warned against any moves to abolish the first home owners grant to fund it.
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Mr Barr on Friday called on his state and territory counterparts to agree to make similar moves through COAG, arguing the first home owners grant no longer serves the purpose for which it was created.
The change would see the government's wider 20-year plan to abolish stamp duty on all home transactions fast-tracked for first home buyers, if a new national agreement was reached.
Numerous economists across the country have long argued the grant led to the inflation of property prices for first home owners, a system Mr Barr earlier this week said created an "inefficient cycle" of money going in and out of government coffers.
"While most jurisdictions have concession or exemption schemes – including the ACT – the eligibility thresholds often lag behind the real price of a home in today's markets," he said in a statement.
"State and territory governments can cut this entirely in a fiscally sustainable way by removing the first home owner grants at the same time."
Housing Industry Association ACT and southern NSW director Greg Weller said the industry would support any moves by other jurisdictions to abolish the stamp duty.
But he said the industry was "cautious" about Mr Barr's call to abolish the grant, arguing it was for new homes only and helped drive building activity and "strengthens the financial position of first home buyers choosing to build".
"If this did occur, it could be expected that the removal of the grant would be immediate, whereas the phase out of stamp duty is a transitional process that is occurring across a number of years," Mr Weller said.
"It is not inconceivable that a future government could choose to walk away from stamp duty reform, yet it would be highly unlikely that a grant for first home buyers would be reintroduced."
Mr Weller also said that "as bad as stamp duty is", it was not the only driver of affordability, urging the territory government to first address other taxes including the recent hike to lease variation charges in last year's budget.
While the government is unlikely to walk away from that tax hike, this week it did introduce a new bill to allow some developers in some circumstances to defer their LVC charges until later in the development process to help ease the up-front costs.
Mr Barr said the grants were further distorting decisions for first home buyers about where and what property they could buy, "channelling demand into particular segments of the market, driving up prices further".
The chief minister also told ABC Radio Canberra on Friday he was aware of the situation facing many low income families in the ACT who earned more than the threshold for many government concessions programs.
In the government's budget review released this week, the government increased utilities concessions for eligible households by $50 a year.
Mr Barr's comments suggest the government is considering increasing the threshold for various concessions programs or possibly widening the criteria a move groups including the ACT Council of Social Services have repeatedly called for.
