Federal government announces new HomeBuilder stimulus package
The federal government has today announced it will be offering Australians $25,000 grants to build a new home or undertake substantial home renovation projects in an effort to boost the economy and to assist the housing sector.
The $688 million HomeBuilder package will be available to owner occupiers who enter a contract to start building or substantially renovating their property between 4 June and 31 December 2020.
Stipulations of the HomeBuilder Grant
Some of the stipulations of the HomeBuilder grant include:
- Work must commence within 3 months of the contract being signed.
- The grant will be administered by the State & Territories.
- Income thresholds will apply as per First Home Loan Deposit Scheme – $125,000 for singles; $200,000 for couples.
- Maximum value of an eligible new home project is $750,000 (including house and land).
- The value of a home renovation project must be over $150,000 up to $750,000 and the existing home must have a pre-construction valuation that confirms the improved value of the property is less than $1.5 million.
- The incentive will complement existing first home owner grant programs, stamp duty concessions and other grant schemes, as well as the First Home Loan Deposit Scheme.
- There is no limit on the number of incentives that can be taken up.
- Owner builders will not be eligible for the incentive.
- Renovation work must be connected to the use of the home as a principle place of residence, e.g. pools, sheds, garages, and the like are excluded.
Package Intended to Create Construction Jobs
In an interview with ABC News Breakfast, Treasurer Josh Frydenberg said the package is intended to create more trade jobs and provide a much needed stimulus for the economy.
“There is a real hole in the housing sector as a result of the coronavirus” said Mr Frydenberg. “It’s a critically important sector to the economy overall; it contributes more than $100 billion to GDP. It is also employing hundreds of thousands of people as well, including sparkies and plumbers and carpenters, people we want to put back to work, to put them off the income supports that they have been getting through the crisis.”
The Housing Industry Association (HIA) today welcomed the government’s announcement.
“The HomeBuilder package will support the delivery of tens of thousands of new home and renovation projects,” said HIA Managing Director, Graham Wolfe.
HIA estimates it could generate over $15 billion in national economic activity.
“Most importantly this incentive will support hundreds of thousands of jobs across Australia. The housing industry directly engages more than one million people – builders, trade contractors, designers, professional service providers and others. It provides jobs for many thousands more in the manufacturing and retail sectors, which supply the materials, products, white goods and furnishings that go into our homes. This incentive will help to address the projected decline in housing activity over the next 12 months.”
HIA had predicted the supply of new houses could drop to as low as 111,000 in 2020/21, rather than the 171,000 original predicted in February this year.
“This incentive will ensure that the significant contraction in new home building activity in 2020/21 is not realised. The package will see slabs poured in the second half of the year, meaning jobs are kept and houses built” said Mr Wolfe.
If you intend to take advantage of the HomeBuilder grant and want to get your new home build or renovation underway, call us on 1300 457 400 for a preliminary check for your approvals pathways assessment. Our team of professional building consultants, private building certifiers and town planners will provide you with clear guidance and practical solutions so that you can get your project started and completed as fast as possible.