If you’ve been thinking about renovating or building your dream home, the recent HomeBuilder grant announced by the Australian government might have perked up your ears. The grant provides eligible owner-occupiers (including first home buyers), $25,000 to build a new home or substantially renovate an existing home. This grant is one of the ways the government is helping the market pick back up after the recent impact of the COVID-19 pandemic.
If an extra $25,000 to build or substantially renovate your home sounds like something you’d be interested in, there are a few key things you need to know.
It’s available for a limited time
The grant is available for building contracts signed between 4 June 2020 and 31 December 2020. Once the contract has been signed, you’ll have three months to commence the construction or renovation to be eligible for the grant.
Good news - if you already own land but haven’t signed a contract to build you are still eligible, provided you meet all the criteria for the grant.
It’s tax free!
Just like other First Home Owner Grant programs offered by the government, the HomeBuilder grant won’t be taxed.
It doesn’t have to be your first home
The grant is available for both current homeowners and first home buyers who qualify.
You need to live there
The HomeBuilder grant is only available for owner occupiers which means it needs to be your principle place of residence. If you’re looking to build or renovate an investment property you won’t qualify.
You can’t build the house yourself
In addition to restricting investment properties, the grant excludes owner builders. Those who carry out the building work themselves or coordinate the necessary tasks are considered owner builders.
Building and renovations must be completed by a licenced or registered builder (depending on the state or territory). In addition, any contract must be made by two parties who are independent of each other e.g. no family or friends.
There are income caps
To be eligible for the grant, you can’t earn more than $125,000 per year individually or $200,000 combined if you’re applying as a couple. The income will be based on your 2018-19 tax returns or later.
There are price caps too
If you’re wanting to build a new home, the property value (house and land) can’t exceed $750,000. If you were hoping to renovate your current home, the renovation contract must be between $150,000 and $750,000 and the value of your existing property before renovations cannot exceed $1.5 million.
Not all renovations are eligible
If you were hoping to use the $25,000 to build a tennis court, pool or a new shed, this grant isn’t for you. Renovations must improve the accessibility, liveability and safety of the property to qualify.
All house types are eligible
Whether you want to build or renovate a house, apartment or a castle (within reason), all dwelling types are eligible under HomeBuilder.
If you’re interested in applying for the HomeBuilder grant, get in contact with your relevant State or Territory government to find out when and how to apply. You will be able to apply for HomeBuilder when the State or Territory that you live in (or plan to live in), signs the National Partnership Agreement with the Commonwealth Government.
Keep in mind there are other eligibility criteria such as being 18 years or older and an Australian citizen to qualify. If you have a few more questions and want to know more about whether you qualify, head here for more information.
Find out more about construction loans* and enquire online today.
This article is for general information purposes and is not to be construed as advice or recommendations. This information must not be relied on as a substitute for professional advice. Any views expressed are the views of People’s Choice Credit Union solely.
* Lending criteria, terms & conditions and fees & charges apply.