There have been many changes to the Australian property market over the past year and a half, with the government stepping in and introducing new policies to ensure that the economy stays strong. Currently, Australian property is not only holding steady but continuing to grow, and analysts have stated that despite the incredible growth, regulators are not likely to step in this year. Without this intervention, it’s likely that property prices will keep rising through 2021 and 2022.
ABC reports that at least one leading analyst has stated that the price surge will slow in 2022, with the government possible introducing macroprudential changes to regulate housing prices. However, for the next financial year at least, property regulations are geared towards encouraging the growth of the housing market. Here are just a few things that will impact Australian property:
First Home Loan Deposit Scheme
The Federal Government’s Budget for 2021-2022 will be expanding the First Home Loan Deposit Scheme by an additional 10,000 places. Under this scheme, a first home buyer who secures one of these places will only need a 5% deposit to buy a newly constructed home or build a new home with the government acting as guarantor for the remaining 15%. They will not need to pay the lender’s mortgage insurance; however, they will eventually need to repay the 15% covered by the government. The goal of this scheme is to enable young people to enter the property market despite rising house prices.
The First Home Super Saver Scheme is another scheme aimed at young and first-time property buyers. Under this regulation, first home buyers may withdraw voluntary contributions (both concessional and none-concessional), plus an amount of national earnings towards the purchase of their first home. Previously, eligible buyers were allowed to release up to $30,000 of their superannuation with no more than $15,000 in voluntary contributions per financial year. This amount has been increased so that first home buyers can now release up to $50,000 of their super to purchase a home.
A new introduction in this years budget, the government has committed to a “Family Home Guarantee”, which is aimed at assisting single parents and helping them achieve homeownership. There are two programs available.
- HomeBuilder program: Under this program, the government will give buyers more time to take advantage of grants by extending the construction commencement requirement from six months to 18 months.
- Family Home Guarantee scheme: Under this scheme, the government will allow up to 10,000 eligible single parents with dependents to build a new home or purchase an existing home with a deposit of only 2%. Only individuals who are able to service a loan will be granted a place.
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