1 December 2020
The recent announcement of an extension to the HomeBuilder grant is very welcome after months of lobbying by Master Builders.
- The grant has been extended to 31 March 2021, but dropped to $15,000.
- The construction commencement timeframe has been extended from three months to six months for all HomeBuilder applicants.
While we would have liked to maintain the grant at $25,000, $15,000 is still a great incentive for anyone looking to build a new home.
Why it’s a win
After commencing on 4 June 2020, it’s fair to say the grant saved the industry, particularly given conditions back in March/April when COVID-19 first hit.
In fact, it has done its job so well, we’ve had reports from some builders who have been forced to prematurely close their books to new contracts. Some buyers are even missing out. The volume of has meant they were no longer able to provide their clients with a guarantee that construction could commence within the three month construction commencement timeframe.
In response to this feedback and to ensure the industry and community could make the most of the grant and demand, we have been pushing the federal and state governments to extend the grant overall and extend the three-month construction time frame to six months.
Residential builders big and small are breathing a sigh of relief as the extension will allow those who had previously closed off their books to new contracts to re-open, ensuring consumers still wanting to take advantage of the grant won’t miss out.
Construction commencement timeframe extended
The extension of the construction commencement timeframe from three months to six months, is particularly important in the face of land and trade shortages, as it will allow many who have already signed contracts the peace of mind knowing they have an extra three months to commence work on site. It will also help the industry make the most of existing demand.
Solid pipeline of work into 2021
The introduction of the HomeBuilder grant has meant builders had a pipeline of work that lasted until the middle of 2021 – but we’ve previously had concerns about what will happen when this demand ends.
The extension of HomeBuilder overall by three months will ensure a longer pipeline of work for our industry and is a great Christmas present for builders, tradies, manufacturers & suppliers and homebuilders.
We want to avoid demand falling away once the grant is off the table, leaving builders and our economy high and dry once the current crop of homes is complete.
We will continue with our lobbying efforts and monitoring building activity levels to ensure that when the current crop of homes are completed, the industry doesn’t face a cliff drop in activity.
Key points you need to know about the changes
- A $15,000 grant for building contracts (new builds and substantial renovations) signed between 1 January 2021 and 31 March 2021, inclusive.
- An extended deadline for all applications to be submitted, including those applying for the $25,000 grant and the new $15,000 grant. Applications can now be submitted up until 14 April 2021 (inclusive). This will apply to all eligible contracts signed on or after 4 June 2020 and on or before 31 March 2021.
- An extension to the construction commencement timeframe from three months to six months for all HomeBuilder applicants. This will apply to all eligible contracts signed on or after 1 January 2021, but will also be backdated and apply to all contracts entered into on or after 4 June 2020.
- The existing new build property price cap of $750,000 will continue to apply in Queensland. There will be an increase to the property price cap for new build contracts in New South Wales and Victoria to $950,000 and $850,000, respectively, where the contract is signed between 1 January 2021 and 31 March 2021, inclusive.
- A change in licensing requirements and registration for builders and developers, as below
- Where an eligible contract is signed on or after 29 November 2020, the builder or developer must have a valid licence or registration before 29 November 2020.
- Where an eligible contract is signed before 29 November 2020, the builder or developer must have a valid licence or registration before 4 June 2020.
Other than the above, the existing program criteria applies. That is, the other existing eligibility criteria remains in place and the $25,000 grant will still be made available for eligible contracts signed on or before 31 December 2020.
Read more about applying on the Queensland Office of State Revenue’s website.