HomeBuilder construction period extended in Victoria

Federal Minister for Housing Michael Sukkar has confirmed that construction commencement time frame for Victorians participating in the government’s HomeBuilder scheme – which provides $25,000 owner-occupiers “substantially renovating” or building a new home from 4 June to 31 December – will be extended to six months.

Under existing arrangements, participants are required to commence construction within three months of the settlement data; however, the exemption has been granted in light of newly imposed stage 4 lockdown measures aimed at curbing the spread of COVID-19.

Mr Sukkar noted that a provision included in HomeBuilder’s design allows states and territories to extend the time frame by up to three months “where commencement is delayed due to unforeseen factors outside the control of the parties of the contract”.

“Given the unique lockdown affecting Melbourne, as well as restrictions throughout regional Victoria, the decision to extend the commencement time frame made by the Victorian Commissioner of State Revenue provides certainty and confidence to applicants and builders alike,” Minister Sukkar said.

“The construction industry is a key to our nation’s economic success and the need for clear and effective guidelines to ensure as many jobs of tradies are protected throughout the COVID-19 pandemic is vital.

“The Morrison government will continue to work with industry stakeholders and state and territory governments as we deal with the economic effects of COVID-19.”

The government recently noted the contribution of the HomeBuilder program on activity in the residential construction sector.

Treasurer Josh Frydenberg cited figures from the Housing Industry Association, which reported that the HomeBuilder package helped spur an increase of almost 80 per cent in new home sales over the month of June following a record-low result in May.

In minutes released from its July monetary policy board meeting, the Reserve bank of Australia (RBA) also acknowledged the impact of the HomeBuilder program.

“Liaison contacts had indicated that the recently announced HomeBuilder package had provided a boost to buyer interest in the detached housing market, but less so for apartments,” the RBA stated.

However, the full stimulatory impact of the HomeBuilder scheme is not expected to be felt until the back end of 2020, when the bulk of construction projects are due to commence.

[Related: Melbourne lockdown to ‘stifle’ short-lived lending recovery]

Charbel Kadib is the news editor on the mortgages titles at Momentum Media.

Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.

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