GARETH PARKER:
Joining me on the line is the Assistant Treasurer and the housing minister, Michael Sukkar. Michael, good morning.
MINISTER SUKKAR:
Morning, Gareth. How are you going?
GARETH PARKER:
Well, thank you. So, you’re doubling the number of people that can access this home guarantee scheme. How does it work?
MINISTER SUKKAR:
Well, we’re more than doubling it from 20,000 places at present to 50,000. In essence, Gareth, this was a scheme we took to the last election and put in place in 2020. It allows first home buyers to purchase a home with a deposit of as little as 5 per cent. Banks are requiring first home buyers in particular to save a 20 per cent deposit so it’s the biggest hurdle to getting into the market. It’s been a huge success; it’s been oversubscribed and that’s why we’re now increasing it to 50,000 places. Of those 50,000 places, Gareth, 35,000 are their for first home buyers, 5,000 places are set aside under the Family Home Guarantee for single parents and they can purchase a home with a deposit of as little as 2 per cent and we’re setting aside 10,000 places for people who build or purchase a new home in a regional area, to support people who want to live in a regional area but also supporting the supply of new housing into regional areas as well. So, 50,000 places in total, deals with the biggest hurdle which is the deposit and also means that those people are not paying thousands and thousands of dollars in lenders mortgage insurance and that’s another one of the reasons why it’s been such a popular scheme over the last couple of years.
GARETH PARKER:
Who’s eligible?
MINISTER SUKKAR:
So obviously for the first home buyer places, first home buyers are eligible. Singles with an income of $125,000 or less or couples with an income of $200,000 or less. For the Family Home Guarantee, you’ve got to be a single parent with a dependent child and then for the regional home guarantee – which is the 10,000 out of the 50,000 total places – you’ve got to be someone who wants to purchase a new home or build a new home in a regional area, broadly speaking.
GARETH PARKER:
There are some strings attached, yes?
MINISTER SUKKAR:
Well, the strings attached are you’ve got to obviously meet the credit assessments of a bank. I mean we’re not lending the money; we’re guaranteeing a portion of the loan. That’s what enables someone to purchase a home, for example, with a 5 per cent deposit instead of 20 per cent deposit…interrupted.
GARETH PARKER:
And if the loan goes bad?
MINISTER SUKKAR:
We’re not lending the money; the bank is lending the money. They’re doing the credit assessment and if the loans go bad, it’s the same as any other loan. Touch wood, to date we’ve had 60,000 people use the scheme and we haven’t had a default yet.
GARETH PARKER:
Zero?
MINISTER SUKKAR:
Zero.
GARETH PARKER:
That’s pretty good.
MINISTER SUKKAR:
That won’t last forever…
GARETH PARKER:
Sure.
MINISTER SUKKAR:
…but it just shows that we’re talking about a really solid cohort of people who, once they get their opportunity to buy a home, they really stick with it. Obviously in an environment with low unemployment and strong economic growth as we are, we’re confident of the scheme. It’s – as I said – been oversubscribed. In a year where we saw house price growth in our regions and capital cities increasing drastically, we’ve seen first home buyers at their highest levels for nearly 15 years and one of the reasons has been because of this scheme. We’re really dedicated to it; the proof is in the pudding – it works. It gets first home buyers into the market much more quickly and that’s why we’re expanding it to 50,000 places every year.
GARETH PARKER:
Can you confirm the $250 cash payments for pensioners and other low-income earners this morning, Assistant Treasurer?
MINISTER SUKKAR:
Gareth, you’ve got to ask these questions, I get it. Unfortunately, I have to give you the stock standard response of watch the Treasurer’s speech tomorrow night. All will be revealed. The Treasurer though has been very clear – as has the Prime Minister – that yes, we’ve got a strong economy that’s leading the world, yes, we’ve got unemployment at 4 per cent. But having said that, cost pressures are weighing on families and individuals and we’re conscience of that and the Budget will seek to address that as well.
GARETH PARKER:
Well rather than then ask you if you can confirm that the petrol excise will be cut where I’ll get the same answer, I’ll ask you this. Is this all a big vote-buying exercise in the shadow of a May election?
MINISTER SUKKAR:
No, Gareth. In the end, what’s guided our decision making on all of the policies you’ll see tomorrow night is the future economic health of the country. Are we completely blind to the real political environment? Of course, not and I wouldn’t insult your listeners by saying that. Of course, we’re politicians, we always have an eye to these sorts of issues in the context of an election. But in the end, what’s dictated our decision making on all the things you’ll see in the Budget are how do we keep the economy growing quickly, how do we keep unemployment low; how do we take pressure off families and if we can do all of those things, then we’ll be setting Australia up not just for the short term but for the medium and longer term as well.
GARETH PARKER:
All right well we’ll find out in about 35 and a half hours. Michael Sukkar, thank you for your time.
MINISTER SUKKAR:
Good on you, Gareth. Thanks.