Master Builders Australia urges the federal government to extend the HomeBuilder program for one year in order to counter potential drop in construction activity.
Denita Wawn, CEO of Master Builders Australia, said that if the HomeBuilder program is considered the "most successful government stimulus" of the decade, the federal government must include its extension in the pre-budget submission.
In fact, despite the program's "success" so far, Master Builders projections show a 27% decline in residential construction activity for the 2020-2021 fiscal year.
"It will be disastrous for many of the estimated 370,000 homebuilding companies that are vital to local economies and communities across Australia unless the government intervenes with the ; HomeBuilder extension and other stimulus, "Wawn said.
According to the Master Builders model, extending the HomeBuilder program for another year will increase GDP to $ 4.5 billion, create more than 4,500 jobs, and build 6,000 new homes.
Also read: What could dampen the activity of buildings?
"The federal government has shown its commitment to builders and builders by announcing HomeBuilder Mark I, and they should be given credit for it. It is now expected to double to secure additional jobs by including HomeBuilder Mark II in the budget. # 39; October, "she said.
HomeBuilder Schematic Improvements
While the program may have stimulated demand for new homes, there are some improvements that would make it more beneficial, especially for potential buyers who are now applying for home loans, according to Paul Bidwell, deputy managing director of Master Builders Queensland.
Bidwell said the current rules prevent lenders from considering the grant in determining loan eligibility. Buyers cannot use the $ 25.00 grant as part of their deposit.
"This technicality could mean that the subsidy is of no benefit to many new home buyers and can only be used by those who can already afford to build without the help," he said. he says. "What we don't want is signed construction contracts to fall when owners fail to secure financing."
In fact, the latest figures from the Australian Bureau of Statistics show that there has been a 64.6% increase in loan approvals for the purchase of residential land. Total home loan commitments increased 32%, with homeowners leading the growth.
"The easing of restrictions on COVID-19 has also given consumers a renewed confidence not only to visit showrooms, but also to go to the showroom. forward with construction work and signing contracts, ”Bidwell said.
Since the pandemic is still continuing, Bidwell said it made sense to extend the grant to maximize the expected benefits not only for the construction industry, but for the construction industry as well. ;economy.
"This will ensure that the cliff face the industry faces is not just delayed for six months; it will be given more time to do its job," he said.
Lobby for a CommunityBuilder grant
Wawn said another possible measure the federal government should consider is rolling out a new stimulus package similar to the HomeBuilder Grant, but aimed at commercial construction.
For this CommunityBuilder grant, the government needs an investment of $ 3.8 billion to jumpstart the economy by $ 6.8 billion and create 13,000 new jobs.
"Commercial construction activity is expected to decline 17%. You won't see many cranes in the sky, and that will mean thousands of businesses may just quit the industry with it. the thousands of jobs they provide. "she said.
Wawn said the program would involve the federal government providing grants to local nonprofit community organizations to help fund the construction of new facilities or the substantial renovation of existing ones.
Under the proposed scheme, the government could set the parameters for funding 25% of projects with a cost of up to $ 5 million. Like the HomeBuilder, grant recipients are expected to contribute the rest of the money and receive additional help from state and local government.
"HomeBuilder has given homebuilders the best months in terms of sales for a decade, and the positive impact on building approvals will show itself strongly in the months to come," said declared Wawn. "CommunityBuilder would have the same effect and would see new or improved community centers, libraries, school buildings and sports facilities."
