Today, the HomeBuilder Scheme was released by the Government. The initiative is to maintain and create jobs in the building industry after Covid19. At this point in time, the main points of this scheme are as follows:
· You are an Australian citizen
· You earn less than $125,000 if single, or $200,000 if a couple
· For vacant land, the value of the land and the price of the construction totals no more than $750,000
· If renovating, the renovation spend must be at least $150,000 but less than $750,000. The value of the property prior to the renovation must be no more than $1.5million.
· Renovations do not include a pool, a shed, or other outdoor renovation.
· Completing a knockdown rebuild also falls within the renovation rules. If the property in its original condition is valued no more than $1.5million, the old house can be removed and replaced with a new build at a cost no more than $750,000
· The contract with the builder, for both new constructions and renovations must be dated between 4 June 2020 and 31 December 2020, with construction to commence within 3 months of this date.
There is a $25,000 incentive to the home owner for complying with the above terms.
Having experience with engaging a project home builder, the process between signing a contract and starting construction can take longer than 3 months. I expect that there will be new provisions introduced to mitigate any delays between the contract signing and construction start date, particularly if the delays are due to council approval delays or the builder unable to start the work within the 3 month period. Time will tell if people will miss out on this grant if delays do occurs.
In Sydney, there are very limited options to finding a land and building package for under $750,000, so the reaction from many is disappointment that it doesn't change their ability to afford to build, or that the builders will see a large upswing in building work in new housing estates. On the positive, builders will likely see an increase in demand via knockdown rebuilds throughout the Sydney region, on the proviso that the home owners earn an income below the maximum threshold to qualify for the grant.
If you are looking to build a home, it may be worth looking at prices above and below the $750,000 mark. There may be more value for money over this limit, as the building industry will still need to fight hard for your business while the grant does not apply to properties over this price. If you buy under $750,000, that $25,000 grant will come in handy to cover the finishing items like the landscaping and the utility and telecommunications connections that can be a stretch to pay for once the building is complete. If this Scheme has you considering that major renovation or buying house and land, email me at firstname.lastname@example.org or phone 0414670151. I can work on your finance approval while you start researching the latest house designs.