The extended deadline for the Australian Government’s HomeBuilder Scheme is approaching. To potentially be eligible for a grant of $15,000, you must enter into a contract to build a new home, substantially renovate an existing home or buy an off the plan home or new home by 31 March 2021.
Whilst the Scheme was initially due to expire on 31 December 2020, in response to pleading from various advocacy groups within the building and construction industry, on 29 November 2020 the Government announced a three month extension. This initiative has propped up building and construction jobs and wages and has helped many Australians continue to move towards fulfilling their home ownership dreams in the midst of the COVID-19 Crisis.
The amount of the grant has been reduced for contracts entered into after 1 January 2021 from $25,000 to $15,000. If you entered into a contract between 4 June 2020 and 31 December 2020 you may still be eligible for a $25,000 grant.
All applications, irrespective of when the eligible contract was entered into, must be submitted by 14 April 2021.
Together with the extension of the Scheme, the Government announced an extension of the required timeframe for commencement of construction from three months to six months after an eligible contract is entered into, increases in the threshold for new building contracts in New South Wales[1] and Victoria[2] and changes to licensing and registration requirements for the builders and developers[3].
Eligibility under the Scheme is limited to individuals[4] building or substantially renovating their principal place of residence and is subject to income caps[5] and contract value thresholds[6].
Eligible renovation work must “improve the accessibility, safety and liveability of the dwelling” according to the Government. The addition of a swimming pool, for example, is not considered an eligible renovation.
The HomeBuilder Scheme is a welcome addition to existing help for new home buyers including the First Home Owner Grant, the First Home Loan Deposit Scheme and stamp duty concessions.
If you require more information please contact Kate Shann – kate.shann@ks-law.com.au or 0408 417 609.
The content of this article is intended to provide a general guide to the subject matter. Specialist individual advice should be sought about your specific circumstances.
[1] $950,000 increased from $750,000
[2] $850,000 increased from $750,000
[3] Where an eligible contract is signed on or after 29 November 2020, the builder or developer must have a valid licence or registration before 29 November 2020
Where an eligible contract is signed before 29 November 2020, the builder or developer must have a valid licence or registration before 4 June 2020
Owner-builders are not eligible
[4] Companies and Trusts are excluded
[5] $125,000 per year for an individual and $200,000 per year for a couple based on 2018-19 tax return or later
[6] New home must not exceed $950,000 in NSW, $850,000 in Victoria and $750,000 in all other states and territories
Renovations must be between $150,000 and $750,000 and the value of your existing property must not exceed $1.5 million before renovation
