COVID-19 has had an economic impact on many sectors, including the construction industry. To help it recover, the Australian Government has introduced the HomeBuilder scheme. Part of this scheme encourages renovations by providing a tax-free renovation grant of $25,000 to people who substantially renovate a home.
If renovating was something you were planning on, now could be a great time to get things started.
Who is eligible for the renovation grant?
To access HomeBuilder, you must be an owner-occupier of the home you want to renovate, as this is not available for investment properties. You need to be an Australian citizen who is 18 years or older. You cannot access this government funding through a company or trust.
There’s an income cap of $125,000 a year for an individual and $200,000 for a couple, based on your tax return from 2018-19 or later.
In terms of the renovation works, you need to be spending between $150,000 and $750,000, and the value of your property cannot exceed $1.5 million. You need to enter into a building contract between 4 June 2020 and 31 December 2020, and construction must begin within 3 months of the contract date.
You need to substantially renovate and improve the liveability, accessibility or safety of your home. This means you can’t just build a new patio, pool or tennis court.
How to apply for the renovation grant
It’s different across the country, so you’ll need to contact your relevant authority for information on when and how to apply. The states and territories need to sign the National Partnership Agreement with the Federal Government and will be the ones who pay you the renovation grant.
Renovating is a way to avoid the numerous costs of selling your home and buying a new one. The obvious one is stamp duty, which is thousands of dollars straight away. But there’s also agency and commission fees, conveyancing, marketing, and styling costs to name a few. Costs aside, renovating also gives you the ability to have personalised features in your home or to create something specific. This can be beneficial if you’re after something that’s uncommon and hard to find.
Renovating your kitchen and bathroom
If your kitchen is dated, dysfunctional or too small for what you need, renovating it could be a great way to use the renovation grant, as it is a substantial, central area that will improve the liveability of your home. Like the kitchen, your bathroom might not be functional, maybe it uses space poorly, or things are broken and not working properly. Renovating your bathroom is a way to update your home and add wow-factor.
The perfect opportunity to modernise your home
If this renovation grant has kickstarted you into action, it’s the perfect opportunity to modernise your home. You could use it to create an open living space and add that indoor-outdoor flow that us Aussies love. Don’t forget about environmentally modernising your home too, with options like solar panels and smart home automation being great ways to create an eco-friendly and energy efficient home.
If you need more space, now’s the time to add that extra bathroom, extra bedroom, or perhaps even go up and add another storey. If this is an option for you, it’s a great way to upsize. Plus, you could be creating some great new views.
Our Home Loan Advisers can help you choose from a variety of renovation finance options available. Find out more about renovating your home and contact a home loan adviser 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.
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