In the lead-up to the Federal Budget, Treasurer Josh Frydenberg has announced additional measures to support Australians seeking to secure their own home.
On Friday, Mr Frydenberg unveiled the Family Home Guarantee, announced the expansion of the New Home Guarantee, and increased the maximum value of voluntary super contributions that can be released as part of the First Home Super Scheme.
The newly established Family Home Guarantee is designed to assist single parents with dependents, allowing them to purchase a home with as little as a two per cent deposit.
The scheme will see 10,000 guarantees made available over the next four years.
In addition, the Government is seeking to extend the New Home Guarantee for a second year, providing an additional 10,000 places in 2021-22.
First home buyers looking to build a new home or purchase a newly built home will be able to do so with a deposit of as little as five per cent.
Meanwhile, Mr Frydenberg said the maximum amount of voluntary contributions that could be released under the First Home Super Saver Scheme would be increased from $30,000 to $50,000.
The Government noted the new measures were designed to support more Australians looking to own their own home, and were part of the plan to secure Australia’s recovery.
The initiatives come on the back of the HomeBuilder program which the Government said had supported more than $30 billion in residential construction with more than 120,000 Australians applying for the grant.
The move has been widely welcomed by industry bodies including the Real Estate Industry Association (REIA) and the Housing Industry Association (HIA).
REIA President, Adrian Kelly said the government-guaranteed transitional loans for single parents that matched a 2 per cent deposit was a :great outcome”.
While the initiative is available for men and women, Mr Kelly notes it maintained a ‘Pink Budget’ focus on helping women into housing.
Mr Kelly said the First Home Loan Deposit Scheme was also a good outcome, with the scheme allowing for 10,000 places for the next financial year for homes built since January 2021.
The increase in the value of voluntary super funds available for withdrawal to purchase a home was also a welcome move, Mr Kelly said.
“Expansion of this scheme has been a long standing REIA priority since it was first introduced and is a good taxation incentive which will help more first home buyers enter the market,” Mr Kelly said.
The Property Council of Australia said the initiatives would assist the residential sector as it continued to drive Australia’s economic recovery.
“These measures build off the economy-saving success of the HomeBuilder scheme by providing more focused support where it is most needed,” Property Council Chief Executive Ken Morrison Morrison said.
“These schemes are targeted to help first home buyers bridge the deposit gap and bring the aspiration of home ownership within reach of a broader range of Australians.”
The HIA also welcomed the moves, noting each measure helped remove the barriers to home ownership.
“Research in 2019 found that 92 per cent of renters aspire to own their own home yet just 49 per cent of renters felt they would achieve home ownership,” HIA Managing Director, Graham Wolfe said.
“The measures introduced over the last three years to assist first home buyers, combined with low interest rates, have been incredibly effective in growing the share of first home ownership in Australia to record heights.
“These new measures will provide ongoing support for households looking to achieve the goal of home ownership.
“The Family Home Guarantee provides a realistic, targeted and practical way to assist single parents build their family’s future.
“While many people can service a mortgage, saving the extra money each week to build up a deposit is simply too hard. This scheme will meet a real need and support thousands of families gain the security that comes with a home.”
Meanwhile, Master Builders Australia said it was a win for builders, tradies, single mums and first home buyers.
“Every $1 spent building new housing delivers $3 in benefits to the wider economy result so this undoubtledly good news for the whole community,” Master Builders Australia CEO, Denita Wawn, said.
“Overcoming the deposit gap is the greatest barrier to home ownership and these measures will be life-changing for so many people.
“The new Family Home Guarantee will be a revolution in providing single custodial parents, the overwhelming majority of whom are women, with a step up to gaining the security that comes with home ownership,” she said.