Thousands rush for HomeBuilder grant
The government's new homebuyer grant has copped a steady stream of backlash, with criticism focusing on the need to spend $150,000 or more on a renovation to be entitled for the $25,000 handout.
But more than 8000 have flocked to the Treasury's website to register interest in the grant that also applies for those building a new home worth less than $750,000.
The applications are likely to surge higher for the stimulus announced last week, according to Housing Minister Michael Sukkar who told The Australian more than 130,000 had inquired about the grant on the website.
"The government expects HomeBuilder will be overwhelmingly supported by first-home buyers, many on lower incomes, looking at purchasing a house-and-land package and growing families seeking to upgrade to a larger new home," he said.
"It will of course include, in some cases, people who will undertake a substantial rebuild of their existing home to meet their future needs."
The $688 million uncapped scheme that applies for building contracts entered into between now and new year's eve is designed to support thousands of jobs in the construction industry and stimulate the economy as it recovers from the fiscal shock of the coronavirus pandemic.
But it won't do enough to bring stock to the housing market, according to deputy Opposition leader Richard Marles.
There is expected to be a shortfall of 60,000 homes because of the pandemic and the government scheme will only add 10,000 properties out of 27,000 projects.
"This should be done a whole lot better and we've been talking over the last few weeks about a range of measures about spending more on social housing … around removing the cap on the first homeowner grant scheme," Mr Marles told the ABC's Insiders program on Sunday.
WHAT IS IT?
For a limited time, the HomeBuilder program will deliver $25,000 grants to help the residential construction industry recover from the coronavirus crisis.
Under the scheme, eligible owner-occupiers - including first home buyers - will get the payment to build a new home or "substantially renovate" an existing one.
The contract must be signed between June 4 and December 31, 2020, and construction must commence within three months of the contract date.
HomeBuilder will complement existing State and Territory First Home Owner Grant programs, stamp duty concessions and other grant schemes, as well as the Commonwealth's First Home Loan Deposit Scheme and First Home Super Saver Scheme, which means you could potentially get more than double the grant depending on where you live.
EXACTLY WHO GETS IT?
The $688 million HomeBuilder program will be available to Aussies who are building a new home worth less than $750,000.
It can also be put towards renovations worth between $150,000 and $750,000 that will result in the property being priced at $1.5 million or less.
The cash can't be used on investment properties or to construct things outside the house such as swimming pools, tennis courts, outdoor spas and saunas, sheds or garages, and the work must be carried out by a licensed builder.
It will be means-tested and will only be available to singles who earn less than $125,00 a year or $200,000 per couple.
When rumours of the program first started swirling, there were concerns it could be hijacked, but the government has committed to "integrity measures" to stop that happening, including "strict eligibility criteria, price caps and income caps to manage demand and support residential construction activity".
Other measures include:
• Owner-builders and those seeking to build a new home or renovate an investment property are ineligible.
• The registered or licensed builder must demonstrate that the contract price for the new build or substantial renovation is no more than a comparable product (measured by quality, location and size) as at July 1, 2019, if requested by the purchaser.
• The renovation works must be to improve the accessibility, safety and liveability of the dwelling, which means the money can't be spent on additions to the property like swimming pools, tennis courts, outdoor spas and saunas, sheds or garages unconnected to the property.
• The contract must be made by two parties independently of each other and without some special relationship, such as being a relative. The terms of the contract should be commercially reasonable and the contract price should not be inflated compared to the fair market price.
HOW DO I APPLY?
According to the Treasury website, Australians will be able to apply for HomeBuilder after their state or territory government signs the National Partnership Agreement with the Commonwealth Government.
So far, critical information such as when you'll be able to sign up and how you can apply will be available through the relevant state or territory revenue office in the near future.
Visit business.gov.au for updated state and territory information as it becomes available.
- With AAP