The latest federal budget has been welcomed by property groups, however some have criticised the federal government for not doing enough on housing affordability.
Housing initiatives in the budget included the expansion of the first home buyers scheme from 10,000 to 35,000 annual places and the creation of a new regional housing scheme with 10,000 annual places.
The first home buyers scheme helps people buy a house with only a 5% deposit while avoiding costly lenders mortgage insurance (LMI).
Property Investment Professionals of Australia Chair Nicola McDougall said saving a property deposit had always been difficult but was even harder now with record property prices and soaring cost of living pressures.
“The doubling of the federal government’s various home guarantee schemes will assist some 50,000 people annually, many of whom may have struggled to achieve home ownership without it,” McDougall said.
“It’s especially pleasing to see the Family Home Guarantee for single parents expanded to 5000 places every year until 2025 because these are the buyers who need assistance the most.”
Australian Property Institute CEO Amelia Hodge welcomed the temporary cut to the fuel excise, which has been halved for the next six months.
“The temporary fuel excise cut is a win for property valuers and other professionals, who spend a lot of time on the road,” Hodge said.
“Our members, big and small, are facing rising costs across the board, but this cut will provide some relief.”
Master Builders Australia CEO Denita Wawn said the extension of the apprentice and trainee wage subsidy until 30 June would cut costs and boost confidence in the industry, as homebuilders struggled with labour shortages.
“The continuation of apprentice and wage subsides albeit at a lower rate from 1 July is also a positive move,” Wawn said.
“Importantly, the budget includes a new $2 billion funding increase for social and affordable housing through the National Housing Investment and Finance Corporation.”
Property Council CEO Ken Morrison said Australia’s economic recovery had been remarkable, however there were risks that falling housing supply could become a drag on the economy.
PCA said the budget highlighted the extent of the housing supply crisis in Australia, predicting dwelling investment levels would drop significantly, from 5% growth this year, into negative territory (-0.5%) by 2023/24.
“While the HomeBuilder scheme saved jobs and delivered great benefits to households, the record pipeline of work it created will come to an end just as our population begins to recover, which will intensify the supply crunch we know is coming,” Morrison said.
“Both HomeBuilder, and the expanded Home Guarantee Scheme are welcome demand-side measures, and cannot address the supply-side issues which increase the cost of new homes.
“The Government’s own forecasts from the National Housing Finance and Investment Corporation (NHFIC) predict that housing supply is set to drop by 35 per cent right at the time population growth would resume, leading to a national deficit of 163,400 homes by 2032.”
Australian Council of Social Service CEO Dr Cassandra Goldie said the budget failed to deliver the investment in social housing needed to put a roof over the heads of people on low incomes.
“Unfortunately, although the government says this is a cost-of-living budget, it fails to deal with the biggest cost of living, which is housing.
“Perversely, its housing measures will very likely push up house prices and make housing affordability worse.”