HomeBuilder scheme set to deliver thousands of extensions, but might need one itself
The response to the Federal Government’s HomeBuilder scheme is exceeding expectations, but a requirement to start construction within three months is testing the capacity of the building industry.
The program provides $25,000 to people who build a new home or substantially renovate an existing one.
However the grants aren’t handed out until work starts, meaning only 780 applicants have got their hands on funding so far.
Housing Minister Michael Sukkar told Sky News the financial assistance is helping to prop up the building sector.
“Given the way in which the scheme operates, we weren’t expecting to get to this level probably until mid-November,” he said.
“We are very pleased with how it’s tracking.”
Getting the money out
More than 11,000 applications for the scheme have been approved, according to the latest data from Treasury.
The money is paid for new builds when the foundations are laid, for renovations when work commences, or for off-the-plan jobs when a name is registered on the title.
But in each case construction must commence within three months after the contract is signed unless there are “unforeseen factors outside the control of the parties to the contract (eg: building or planning approvals)”, according to Treasury guidance.
Labor leader Anthony Albanese labelled the scheme a “marketing exercise”.
“If you look at how many people have actually benefited in terms of dollars going out the door it’s very small,” he said.
Call for extension
The HomeBuilder scheme was introduced in the grip of the pandemic as a stimulus measure for building contracts signed between June 4 and the end of the year.
CEO of Master Builders Australia, Denita Wawn, said states should follow Victoria’s lead and extend the three-month deadline by which building must start.
She also called for a 12-month extension to the scheme due to the demand and paperwork.
According to the Housing Industry Association, new home sales have increased by almost 50 per cent in the four months since the scheme was introduced, compared to a similar period last year.
The scheme is limited to people with an annual income of $125,000 or a couple with $200,000.