The trap I can see is that if one goes into the market in the next few months and buys a $300k house using some savings and the Taxpayer funded Grant of $14K and the house value falls 5%, there's no grant left. Another 10% and there's no deposit left.
Personally, I'm thinking that falls of 50% are possible, particularly in the outer high mortgage areas.
So the incentive to buy a house will most likely become a debt trap.
So this additional grant will become a waste of taxpayers money, a trap for the first home buyer and a bad debt risk for the Banks which may fall back to the Government under their recent Bank Deposit Guarantee legislation.
