The Australian government will increase income and property price caps for its Help to Buy scheme, aiming to make housing more affordable for first-time buyers and further stimulate the property market.
Labor will expand its flagship Help to Buy scheme, raising income and property price caps in an effort to make homeownership more accessible to Australians. The scheme, announced in the last budget, provides first-time buyers with up to 40% of the purchase price of a new home or 30% for an existing property, contingent on a minimum 2% deposit from the buyer. The initiative is capped at 10,000 places annually for a total of 40,000 over four years.
Housing Minister Clare O’Neil stated the changes will ensure “most first home buyers” qualify. Income thresholds are being raised to $100,000 for individual applicants and $160,000 for joint applicants and single parents, reflecting a hike from $90,000 and $120,000 respectively. Property price caps will also be adjusted in line with average house prices in each state and territory, shifting from the current dwelling price cap which encompasses all residential properties including apartments and units. “In Brisbane, for example, we’re raising property price caps from $700,000 to now $1m,” O’Neil explained. “In Melbourne from $850,000 to $950,000, and in Sydney from $950,000 to $1.3m.” In NSW, the price cap will remain at $1.3m, despite the median house price approximating $1.5m, to ensure affordability for first-time buyers.O’Neil emphasized that the scheme is crucial in assisting many Australians achieve homeownership dreams, anticipating high popularity. The government will inject an additional $800 million, increasing its equity investment in the program to $6.3 billion, to support these changes. Furthermore, $54 million will be allocated to expedite prefabricated and modular home construction, a method claimed to be up to 50% faster than traditional construction. Opposition Leader Peter Dutton criticized the housing market, arguing that young people shouldn’t co-own with the government. Independent ACT Senator David Pocock lauded the Labor government’s move, stating that while there’s no “magic bullet”, these are prudent changes that will benefit more buyers. The Greens, who initially advocated for reforms to negative gearing and capital gains tax concessions in exchange for their support on Help to Buy, eventually dropped their demands, opting for an additional 25,000 social and affordable homes. They ultimately helped Labor pass the legislation, vowing to revisit these issues if their party holds the balance of power in the event of a hung parliament after the next election
Real Estate Help To Buy Homeownership Housing Crisis Australian Government Labor Party First-Time Buyers Property Prices Budget Clare O'neil
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