Everything you need to know about Australia's $25,000 HomeBuilder grant + how much off-the-plan homebuyers could save
As a means to recuperate financial losses caused by the COVID-19 pandemic, the Federal Government has announced a stimulus package for the construction industry – with its benefits extending to home buyers and property owners.
The Government plan to distribute approximately $688 million worth of funding as $25,000 HomeBuilder grants, which eligible owner-occupiers can apply for to build a new home or substantially renovate an existing property. This funding also includes the purchasing of brand new off-the-plan properties.
HomeBuilder will endeavour to reinvigorate the residential construction industry, providing a boost in work opportunities and bringing financial relief.
When is the HomeBuilder grant available?
Contracts entered into between 4th June 2020 and 31st December 2020. The building work must commence within three months of the contract date.
Is the HomeBuilder grant compatible with First Home Buyer Grants and Stamp Duty Concessions?
Applicants may apply for the HomeBuilder grant in conjunction with other grants (such as the First Home Buyer Grant and Stamp Duty concessions), as well as the Commonwealth's First Home Loan Deposit Scheme and First Home Super Saver Scheme.
Why has the HomeBuilder grant been established?
Offering the HomeBuilder grant is a Federal initiative that will aim to support more than 1 million builders, painters, plumbers and electricians whose work has been impacted by COVID-19.
Who is eligible for the HomeBuilder grant?
Applicants must be an owner-occupier who meets the following criteria:
- you are an individual, not a company or trust; o you are aged 18 years or older;
- you are an Australian citizen; o you meet one of the following two income caps:
- $125,000 per annum for an individual applicant based on 2018/19 tax return or later; or
- $200,000 per annum for a couple based on your combined on 2018/19 tax return or later;
- you enter into a building contract between 4th July 2020 to 31st December 2020 to either:
- build a new home as a principal place of residence valued up to $750,000 (including land); or
- substantially renovate your existing home as a principal place of residence, with renovations valued at between $150,000 and $750,000 with the dwelling not valued at more than $1.5 million before the renovation;
- construction must be contracted to commence within three months of the contract date.
*Source: HomeBuilder, Frequently Asked Questions
What are some of the HomeBuilder grant restrictions?
Applicants cannot owner-build a new home or use the grant to renovate an investment property.
Work must be carried out by a licensed contractor who has held sufficient registration prior to the date of the funding announcement.
Who receives the money?
Funding will go to individuals, not contractors.
I found an off-the-plan property on Urban that I'd like to buy. Am I eligible?
Good news, the grant does extend to off-the-plan purchases, so long as you sign your contract between the period of 4th June 2020 to 31st December 2020 and meet the eligibility criteria.
According to Treasury.gov.au,
"All dwelling types (house, apartment, house and land package, off-the-plan, etc) are eligible under HomeBuilder, in accordance with the requirement that the owner-occupier must contract to build a new dwelling or substantially renovate their existing dwelling. The applicant must also meet the eligibility requirements outlined above."
Are there any off-the-plan funding restrictions?
The Government has noted that a national price cap of $750,000 will apply to new build homes. That means the total value (land + property) must not exceed $750,000 to be eligible for the grant.
Is the HomeBuilder grant taxed?
According to Treasury.gov.au, no, the grant will not be taxed.
How much could I save on my off-the-plan purchase?
HomeBuilder, coupled with additional grants applicable depending on where you live, could see significant savings off your off-the-plan purchase. The only catch is that you purchase your new home by New Year's.
VICTORIA - Up to between $45,000 and $55,000
NEW SOUTH WALES - Up to $45,000
QUEENSLAND - Up to $50,000
SOUTH AUSTRALIA - Up to $50,000
AUSTRALIAN CAPITAL TERRITORY - Up to $35,000
NORTHERN TERRITORY - Up to $45,000
TASMANIA - Up to $55,000
WESTERN AUSTRALIA - Up to $45,000
*Source: news.com.au
How do I apply?
You can apply through your state or territory revenue office here:
This article is based off information sourced from the Australian Government Treasury website on 4th June 2020. Should you wish to clarify any information listed in this article, reach out to your local revenue office.
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