Older Australians who are looking to downsize are tipped to be the big winners from Scott Morrison’s latest stimulus package, according to an industry expert.
The government has unveiled the HomeBuilder scheme, which will see eligible owner-occupiers who are either building or undertaking a substantial renovation given $25,000 for doing so. But who will actually benefit from the stimulus?
In an information package revealed overnight, the Treasury said the HomeBuilder is a time-limited grant program designed to help Australia’s residential construction market bounce back from the coronavirus crisis.
HomeBuilder will provide eligible owner-occupiers, inclusive of first home buyers, a grant of $25,000 to build a new home or substantially renovate an existing home where the contract is signed between 4 June 2020 and 31 December 2020.
Construction works on the home must commence within three months of the contract being signed.
“The HomeBuilder package will support the delivery of tens of thousands of new home and renovation projects,” said HIA managing director Graham Wolfe.
HIA estimates it could generate over $15 billion in national economic activity.
“Most importantly, this incentive will support hundreds of thousands of jobs across Australia.
“The housing industry directly engages more than 1 million people – builders, trade contractors, designers, professional service providers and others. It provides jobs for many thousands more in the manufacturing and retail sectors, which supply the materials, products, white goods and furnishings that go into our homes.
PIPA chairman Peter Koulizos has also come out in support of the government’s new scheme.
“The federal government’s HomeBuilder scheme will be a welcome shot-in-the-arm for the construction section over the next six months.
“Not only will it help more first home buyers into the property market, but it will also allow current home owners to upgrade to a new dwelling or to update their current home, which can improve their financial futures.”
The peak body for the residential land lease community believes older Australians looking to downsize are the major beneficiaries of this new scheme.
With over 100,000 Australians already choosing the lifestyle and security of a land lease community, the HomeBuilder grant will allow many more Australians to downsize out of the suburbs through the construction of a new house within a residential community.
Chair of the Residential Land Lease Alliance James Kelly said the grant, available on new contracts from 4 June, will not only stimulate new housing sales, but will also free up equity for older Australians to otherwise spend through the economy while also assisting housing stocks of established homes in the suburbs for families looking to get into the housing market.
“The benefits of a land lease community are being recognised by more and more Australians as they look to move into their next phase of their life and prepare for an active and connected lifestyle,” said Mr Kelly.
“The market has been somewhat subdued with the uncertainty of the COVID-19 crisis, but today’s announcement, along with the strict hygiene and social distancing procedures of the industry, will provide confidence for Australians to jump into land lease community living.”
“The land lease community model allows for Australians to purchase a home (as an asset and able to be resold), on land with a right to tenure, and gain access to community facilities. This is proving a popular model for older Australians looking to free up capital, lead a social and active life while having the security of independent living,” Mr Kelly concluded.