The Federal Government has announced a raft of increases to national housing initiatives ahead of its May 9 Budget, including an additional $2 billion for social and affordable rental housing.
The Albanese Government has also significantly expanded the eligibility criteria for all elements of the Home Guarantee Scheme.
Minister for Housing Julie Collins said an extra $2 billion would be set aside for more social and affordable rental properties, with the National Housing Finance and Investment Corporation’s liability cap to rise from $5.5 billion to $7.5 billion from July 1 this year.
This will enable the NHFIC to support more social and affordable rental homes by providing lower cost and longer-term finance to community housing providers.
“The Albanese Labor Government was elected with an ambitious housing agenda,” Ms Collins said.
“This boost in the Budget will help get more Australians into affordable rental homes sooner.
“This is action that will have a real impact on people’s lives, and will support our plans to build tens of thousands of additional social and affordable rental homes right across the country.”
The Government will also offer incentives in the Budget to increase the supply of rental housing by changing arrangements for investments in built-to-rent accommodation.
The depreciation rate will rise from 2.5 per cent to four per cent per year on eligible new build-to-rent projects where construction starts after May 9.
They will also reduce the withholding tax rate from 30 per cent to 15 per cent for eligible fund payments from managed investment trusts to foreign residents on income from newly constructed residential build-to-rent properties after 1 July 2024, subject to further consultation on eligibility criteria.
The measures come in addition to the $10 billion Housing Australia Future Fund, which will build 30,000 affordable rental homes in its first five years, the National Housing Accord, which aims to build one million new, well-located homes over five years from 2024, and investing a further $350 million in additional funding for 10,000 affordable rental homes over five years from 2024 as part of the Accord.
The government has also expanded the eligibility criteria for the First Home Guarantee, the Regional First Home Buyer Guarantee and the Family Home Guarantee.
From July 1 this year, friends, siblings, and other family members will be eligible for joint applications under the First Home Guarantee and the Regional First Home Buyer Guarantee.
These guarantees had previously been restricted to people that were married or in a de‑facto relationship, in addition to single applicants.
The guarantees will also be expanded to non‑first home buyers who haven’t owned a property in Australia in the past 10 years to support those who have fallen out of homeownership, often due to financial crisis or relationship breakdown. .
“We know friends and family members are already teaming up to secure their own place to call home,” Ms Collins said.
“Our actions will allow them to access vital assistance, just as couples have been able to previously.”
Family Home Guarantee eligibility will also change, expanding from a single natural or adoptive parents with dependents to eligible borrowers who are single legal guardians of children, such as aunts, uncles and grandparents.
“These are sensible changes that will help ensure more families have a safe and secure place to call home,” Ms Collins said.
All three guarantees will also become available to eligible borrowers who are Australian Permanent Residents, in addition to Australian citizens.
These changes will build on last year’s increase in the number of places available and the establishment of Albanese Government’s new Regional First Home Buyer Guarantee.
In total, 35,000 places are available per year across the First Home Guarantee, 10,000 places per year to 30 June 2025 under the Regional First Home Buyer Guarantee, and 5000 places per year to 30 June 2025 under the Family Home Guarantee.
Ms Collins has also signed a revised National Partnership Agreement to extend the deadline for existing HomeBuilder applicants to submit supporting documentation to 30 June 2025.
The extension will apply to all existing HomeBuilder applicants, including for off-the-plan purchases, new builds and renovations. It will take effect in each jurisdiction once it is signed by the relevant State and Territory Government.
The extension will support existing applicants who had entered into financial commitments on the basis they would receive the grant but through no fault of their own were affected by supply constraints and construction industry delays.