Minister Sukkar:
Well good morning. We started this week by extending the Morrison Government’s HomeBuilder program. A program which delivers $25,000 grants to owner-occupiers to purchase a new home. This was done in response to the commencement of the pandemic where the housing industry - which employs up to 1 million Australians - said a valley of death could be reached, given the results of the pandemic. Well once we introduced HomeBuilder, we have now seen it ignite the residential construction market. This week, we have seen a succession of data that has confirmed that the Morrison Government’s HomeBuilder program - and other measures we’re taking in the housing space - is doing exactly what we intended. It is supporting those 1 million jobs in the residential construction industry. Whether it’s the tradies onsite, the carpenters, the bricklayers, the electricians, the plumbers, or the timber mill workers who make the frames and the trusses, the manufacturing workers who make the glass, the tiles and the bricks.
It is also supporting, we are seeing overwhelmingly first home buyers getting into the market. This week, we saw ABS data which showed a 62 per cent increase on last year in owner-occupy construction loans. 62 per cent. HIA published data that shows new home sales are up by 31.6 per cent since the introduction of the HomeBuilder program. Again, we saw data this week that showed that new home buys at their highest level in ten years. And finally, we saw some analysis from Morgan Stanley which showed that in the great state of Victoria where we are at the moment, that the HomeBuilder program has off-set the impact of the extended Melbourne lockdowns.
Now what does all this mean? Well of course it means that the Morrison Government is supporting an industry that is 5 per cent of our GDP, $100 billion a year, and as I’ve said, employing 1 million Australians. But it also is ensuring that the Liberal and National parties deliver for first home buyers. The HomeBuilder program of course was announced in response to the pandemic, but a range of measures before then put in place by this Government are intended and are really supporting first home buyers. Most notably, the First Home Loan Deposit Scheme which commenced on the 1st January this year with an initial allocation of 10,000 places that were enthusiastically taken up by first home buyers. The First Home Loan Deposit scheme which allows them to purchase their new home with a deposit of as little as 5 per cent with a government-backed guarantee. The reason why the First Home Loan Deposit Scheme is so important is that getting that deposit together is increasingly the hardest part of purchasing a new home. We released another 10,000 places under the First Home Loan Deposit Scheme on 1st July and they have nearly all already been taken up. And finally, in the Budget, again to support first home buyers but also the residential construction industry, we released another 10,000 places with one additional requirement with that being that those first home buyers who participate in the First Home Loan Deposit Scheme, purchase a new home. A new home that will, again - in addition to the HomeBuilder program - support the residential construction industry.
So this week, we commenced the week by extending HomeBuilder because it has ignited the residential construction market and we have seen a succession of data from the ABS, from the HIA, from the Master Builders Association, which has confirmed that. And repeating that, a 62 per cent increase in owner-occupier loans. A 32 per cent increase in new home sales, and first home buyers at a ten year high. The Morrison Government is here to support first home buyers, to help Australians realise their aspirations and purchasing their new home. All the decisions that we take in the housing space, but more broadly from a Treasury perspective, are there to incentivise, to assist and support Australians who want to get into their first home, and of course, to support the 1 million Australians who work in the residential construction industry.
Journalist:
You announced at the weekend that you’d extend the program but at a lower rate. Is there any consideration - considering the uptake of that - will you consider maintaining the current rate instead of dropping it down?
Minister Sukkar:
Yeah look it’s a very good question. We made a very deliberate decision with the extension of the HomeBuilder program to the 31st March, to tapper it down from the $25,000 that is still available for contracts signed until the 31st December, to $15,000. Now that’s a bit of a reflection on the strength of the market and I think a recognition that the $25,000 level that was put in place at the height of the pandemic, recognised the extraordinary circumstances there. But since then, we’ve also seen state governments put in place additional support. We’ve seen the Western Australian State Government, the Tasmanian State Government, with their own grants. We’ve seen the New South Wales State Government and most recently, here in Victoria, additional stamp duty exemptions. Once you add all of those incentives up, we felt as though a tapering of that rate was still a really great incentive for Australians to purchase a new home.
Journalist:
So no plans to drop it then?
Minister Sukkar:
No, the scheme will run to 31st March at $15,000 and we think that’s a really great incentive.
Journalist:
Are builders keeping up with demand?
Minister Sukkar:
Very good question. One of the motivations for us extending the HomeBuilder scheme was that it was so successful that builders were saying to us, ‘we’re going to struggle to meet the construction timeframes’. Under the HomeBuilder program, we require - or we did require - construction to commence three months after signing the contract and lots of builder’s books were filling up very quickly. So as part of the announcement on the weekend, we have now said that that is six months and that is certainly going to give builders time to take on all of those enthusiastic purchases and spread them out over a longer period of time.
Journalist:
Are there any safeguards that you can put in to stop builders taking advantage of this and inflating prices?
Minister Sukkar:
Again, great question. We’re very keen to make sure that the HomeBuilder program, when it was put in place, just didn’t end up in the pockets of land developers and builders. So we’ve actually put in place in the program, a requirement or an ability for a purchaser to request a price comparison between the product that they’re buying, to one year earlier, to make sure that they’re getting the price that was available at that time. A really strong safeguard to make sure that there’s not inflation creeping into the program and our feedback to date is that that has been really positive at keeping discipline in the level of prices.
Journalist:
And just on another matter, do you think that it was appropriate for the PM and the Treasurer to take a taxpayer funded flight to Sydney last year so that they could go to Lachlan Murdoch’s Christmas party?
Minister Sukkar:
I’m not going to comment too much on the detail just because I’m not overly aware of it but the reality is that politicians fly all around the country for a myriad of functions and events and I’m sure that, in all instances, the Prime Minister and the Treasurer have done the appropriate thing.