The HomeBuilder grant scheme is twice as popular as anticipated and is set to cost the government an expected $2 billion.

The original estimate for the scheme was $680 million for 27,000 grants when the prime minister first announced the initiative in June.

The latest figures released from the federal government shows nearly 75,000 households have taken up the offer for the $25,000 grant before 31 December.

Although the cash grant wound down to $15,000, the grant will continue to 31 March with the construction commencement date extended to six months, continuing to boost the residential sector.

The treasury estimates HomeBuilder will now support up to $18 billion residential projects supporting construction into 2022.

Minister for housing Michael Sukkar said they were pleasantly surprised with the results of the demand driven program .

“HomeBuilder was designed immediately to inject confidence and encourage buyers back into the market to offset the devastating effects of the pandemic on the residential construction industry,” Sukkar said.

“On all counts HomeBuilder has more than achieved this objective, and it has kept hundreds of thousands of tradies in work who would have otherwise been facing the unemployment queue.

“This is a phenomenal outcome for our tradies and for our economy at a time it needs it most.”

However the grant scheme and low interest rates have brought forward buyers leading the Reserve Bank analysts to predict home prices could increase by 30 percent.

New home sales nearly double

New home sales have jumped to the highest point in 20 years according to the latest HIA report.

Across the country, new home sales in the December quarter were higher in all regions when compared with the same period in 2019.

South Australia was up 188.3 per cent, Victoria 103.1 per cent, Queensland 99.9 per cent, Western Australia 99.2 per cent and New South Wales up 61.7 per cent.

HIA economist Angela Lillicrap said this is the second strongest month of New Home Sales in the 20 year history of the survey, only exceeded by March 2001.

“The extension of the timeframe to commence building from three months to six, which was announced in November, played a significant role in December’s results,” Lillicrap said.

“New home sales in 2020 increased by 32.5 per cent compared to 2019.

“This is an exceptional result given the nature of the pandemic and the effect that it has had on the broader economy.”

So far global house prices have defied the pandemic however the likelihood of a house price bubble and its risk of bursting is yet to be seen.

New home sales in 2020 increased by 32.5 per cent compared to 2019.

“This is an exceptional result given the nature of the pandemic and the effect that it has had on the broader economy.”

So far global house prices have defied the pandemic however the likelihood of a house price bubble and its risk of bursting is yet to be seen.

[vc_row][vc_column][vc_column_text]Our facility has been designed to meet the changing environment confronting the building industry in 2020. It enables home buyers to maximise their opportunities by bringing forward applicable Federal and State based Grants into lending policy in an ‘above the line’ transaction which allows lenders to minimise risks while providing reliable and ongoing funding for construction purposes in the First Home Buyer market.
It is a specialised program made available by the Funder to selected and approved builder relationships. The product combines a first mortgage of up to 80% LVR with a second mortgage of up to 15%. *The Lender Protection Fee of 3.50% replaces traditional Lenders Mortgage Insurance and is paid by the Builder directly to the Lender to access this specialised funding line.[/vc_column_text][vc_empty_space alter_height=”medium” hide_on_mobile=””][/vc_column][/vc_row][vc_row][vc_column width=”1/2″][vc_column_text]Only $5000 genuine savings are required.

• Grant can be used as balance of 5% deposit.
• Gifts can be used as balance of 5% deposit.
• Rebates can be used as balance of 5% deposit

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• Up to 95% LVR.
• Choice of valuers

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