Picture: AAP Image/Lukas CochSource:AAP
You may have heard the exciting news buzzing around the proposed $25,000 grant for new home builds or substantial renovations to existing homes, and yes, you heard it right.
The Morrison government on Thursday June 4 revealed its $688 million HomeBuilder program which will offer one-off cash payments to eligible owner-occupiers and first home buyers from July 4 to December 31 to entice investment in the sector.
This news came shortly after the confirmation from Australian Treasurer Josh Frydenberg that, following a 0.3% contraction in economic growth for the March quarter, Australia's economy is now in recession. ‘‘The health measures that we have put in place, they have come at a significant cost, which is illustrated in the national account numbers today,’’ Frydenberg said. So, there's a clear ploy as to why this may have been announced so soon.
While this news comes as an exciting stimulation for people looking to invest in the property sector, perhaps expediting their interest in the matter, this incentive actually comes as part of a larger plan. The Liberal Government's HomeBuilder program is designed to spark a "tradie-led recovery" after the Australian Bureau of Statistics found that building approvals fell by 1.8% in April after a 2.6% drop in March within the building sector.
Yesterday, the SHM reported that alterations and additions tumbled by 13.2 per cent in April, the biggest drop in three years, while commercial building approvals dropped by almost 12 per cent. Following this news, Prime Minister Scott Morrison said that this investment is not just one targeted at helping Australians see their dream home come to life, but rather one assisting the more than one million builders, painters, plumbers and electricians in a time of need across the country.
So, what does this all mean, and who qualifies for the $25,000 grant? To qualify for the HomeBuilder program, you will need to be building a new home worth less than $750,000 or renovating an existing property that has previously been valued at less than $1.5 million. Applicants for this scheme must also meet two income caps to qualify for the scheme;
- Singles must be earning $125,000 or less based on their 2018/19 tax return or later.
- Couples must have a combined income of less than $200,000 based on their tax returns.
What is particularly interesting about this program is that it is not just limited to first home buyers looking to build a new home, with the cash grants to be extended to owner occupiers of whom are wishing renovate their family home. So, if you've been putting off that home renovation on your mind, now is the time to get a jump on your dream project. And, what's more, is that the $25,000 grant is on top of 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.
It's important to note, however, that Homebuilder grants cannot be used for additions to the property that are unconnected to the principal place of residence such as swimming pools, tennis courts, outdoor spas and saunas, sheds or garages.
For many singles, couples and families, this grant will enable great things to happen. Great things not just for those looking to buy, build or renovate, but also for those people in the building and construction industry currently struggling to find work. As the Morrison Government also noted, "Australia is reopening," and fighting to keep the Australian home owners dream alive.
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