COVID-19 HomeBuilder scheme gets extended and expanded into 2021

COVID-19 HomeBuilder scheme gets extended and expanded into 2021
Staff reporterDecember 7, 2020

The Federal Government program offering cash grants for house and land and apartment construction projects has been extended, but at a lower amount.

The HomeBuilder program had been due to finish at the end of the year, but will be extended until March 31, as builders were concerned of a bottleneck of applications towards the end of the scheme.

Of the 24,000 applications, 19,180 are for new builds - houses and apartments - with 4,697 for renovations.

Contracts signed between January and March next year will attract a lower rate of $15,000, not the current $25,000 rate.

Home buyers will be given more time to start construction.

The price caps in NSW and Victoria will be lifted.

Property price caps for new builds in the two key states will be lifted for contracts signed between January and March next year, rising to $950,000 in New South Wales and $850,000 in Victoria.

Prime Minister Scott Morrison said the extension was expected to lead to another 15,000 construction projects, bringing the total anticipated renovations or builds under the program to 42,000.

"It's critical we keep the momentum up for Australia's economic recovery," Mr Morrison said.

"Extending HomeBuilder will mean a steady pipeline of construction activity to keep tradies on the tools."

The amount of time all approved applicants who signed contracts on or after June 4, 2020, are given to start construction has been extended from three months to six months.

The latest measures have been costed at $240 million, bringing the total expected to $921 million.

Urban Taskforce CEO, Tom Forrest said he was delighted to see that the Government had listened.

“The HomeBuilder scheme was limited in its original design because of the price caps that resulted in very limited applicability in the main markets – Sydney and Melbourne. 

“Today the Morrison Government has increased the eligibility cap for NSW and Victoria from $750,000 to $950,000 and $850,000. 

"Urban Taskforce members welcome this adjustment – though many lament the length of time it took for the government to respond to industry concerns.”

“While the extension in the requirement to commence construction work from 3 months of an application to 6 months is very welcome, it is disappointing that the HomeBuilder support package has dropped from $25,000 to only $15,000 for applications made between 1 January and 31 March 2021.

“The revised scheme will support the production of new homes, reducing upward pressure on prices," he added.

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