The Rudd Government's boost to the first-home owners grant stirred up many old wives' tales that have sustained the great Australian dream of home ownership. It's time to dismiss a few of them.

Across the country, baby boomer parents whisper in the ears of their progeny that now is the time to buy. They warn: "You'll never get in if you don't." They say: "You're better off paying off your own mortgage than your landlord's." For those not yet convinced, they resort to the old catchcry: "Rent money is dead money."

Kevin Rudd Credit:John Shakespeare

What they forget is that average house prices are now seven times the average annual salary, up from about three times when the boomers first bought in. They forget, too, that in the months since the temporary boost to the first-home owners grant - $7000 for established homes and $14,000 for new ones - house prices in the sub-$500,000 category have ballooned.

Seemingly unaware of the false economy, first-home buyers have engaged in a game of mutually assured destruction, and in fact, have been bidding house prices up.