The release of the Federal Budget for 2022-2023 has been disclosed. Here what’s in it for property and the real estate sector.
National Housing Accord
The National Housing Accord sets an aspiration target to build one million new, well-located homes over 5 years from mid-2024. The Accord is said to recognise most of the housing supply needs to come from the market, with the government playing a key role in enabling and kick-starting investment. The idea is that this Accord will free up the housing pressures faced by many Australians who struggle to find housing by supplying affordable homes.
Under this Accord, state and territory governments will undertake expedited zoning, planning and land release to deliver a joint commitment to improving the availability of social and affordable housing, including looking for immediate opportunities to free up state land.
Housing Australia Future Fund
With the target of putting a roof over every Australian’s head, the Government will create a $10 billion Housing Australia Future Fund (HAFF). The Fund is set to build 30,000 new social and affordable housing properties in its first five years.
Each year, investment returns from the HAFF will be transferred to the National Housing Finance and Investment Corporation (NHFIC) to pay for social and affordable housing projects.
Over the first five years the investment returns will focus its build around:
- 20,000 social housing properties – 4000 of which will be allocated to women and children fleeing domestic and family violence, and older women on low incomes who are at risk of homelessness; and
- 10,000 affordable homes for frontline workers
Regional First Home Buyer Guarantee
The Government is helping 10,000 eligible first-home buyers a year in regional Australia to buy a home by guaranteeing up to 15 per cent of the purchase price.
Help to Buy Scheme
To further support Australians, the Government has introduced the Help to Buy Scheme. It is a shared equity scheme, where the Government helps by contributing up to 40% of the property price for a new home and up to 30% for an existing one.
10,000 places will be available for eligible Australians each year. This encourages buying your first property with a smaller down payment.
Support for Downsizers
Downsizers have not been forgotten. According to the budget release, the Government is extending the exemption of home sale proceeds from pension asset testing by 12 months. They are also expanding access to make downsizer contributions to superannuation for people ages 55 to 59.
Points to Ponder
While it is encouraging to see that the Federal Government is recognising that housing supply is part of the solution to getting Australians into their own homes, however it is not one with immediate results.
As for the Accord, there is also a question of what would be deemed ‘well located’ which would dictate whether there will be demand for such houses.
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