The COVID-19 pandemic has taken its toll on economies the world over. Many industries have been left completely unable to function and with news of government bail-outs coming in thick and fast, it’s no surprise that the word ‘recession’ wasn’t far behind.
Australia’s people may have avoided the worst of the virus itself, with case numbers falling by the day. The same cannot be said for its economy however, with the government recently confirming a recession for the first time in 30 years.
Following an announcement just a few days ago, a new package designed by the federal government plans to get the economy back on its feet and put the locked-down tradesmen and women back to work. The package targets the housing-sector, as one of the nation’s largest GDP contributors and one of the hardest hit by the recent economic downturn.
The HomeBuilder program ensures that grants of up to $25,000 will be offered to those looking to build new homes or undertake major renovations on existing properties. The scheme estimated to be capable of providing over 30,000 new homes by Christmas, creating over 18,000 full-time jobs in the process. This hopes to take carpenters, electricians, plumbers and other tradesmen and women off of income support and put boots back on the ground on construction sites. If all goes to plan, this will be a well-needed stimulant for the job market and related industries that have fallen on hard times.
Only lasting until the end of the year to prevent a jump in house prices, the program will work alongside existing government schemes and will be available to those with middle incomes. It will be limited to renovations with a cost between $150-750,000 to properties with a pre-renovation price tag of under $1.5 million. The grant will also be restricted to renovations on the house itself, so it won’t be able to be utilised on pools, sheds or any other outbuildings.
The grant will be means-tested, which allows both singles and couples that wish to get on the property ladder, a fair crack at accessing the scheme. With the earning threshold for singles being $125,000 in the last financial year and $200,000 for couples.
The HomeBuilder program has already come under fire from opposition, however, as the scheme excludes grants to those in social or affordable housing. It is instead targeted at those who can already afford to buy a house, encouraging them to spend and invigorate the dwindling housing sector. With the COVID-19 crisis putting a strain on those in need of emergency accommodation and renters who are living in fear of losing their jobs and facing eviction, some see this scheme as a step in the wrong direction.
Despite critics, the government is confident that programs such as this will be able to light a fire under the struggling housing sector and provide a well needed boost for all Australians. However, in the midst of such an unprecedented crisis, many believe that the scheme, in its current form, is failing those that need it the most.