Tom Connell:
A government scheme to help people into their first home is continuing today; another 10,000 positions available for those seeking help for their deposit to avoid mortgage insurance. Joining me live now is Assistant Treasurer, Michael Sukkar, for more on this, and the Housing Minister as well. Thanks for your time. So, 10,000 more positions; that did seem pretty popular last financial year. Is the advice for people to move quickly?
Minister Sukkar:
Well, Tom, it has been an extraordinarily successful scheme, a Morrison Government scheme, that we committed to before the last election and have delivered from 1st January. 10,000 places are released today. In essence, the scheme allows people to purchase their first home with a deposit of as little as 5 per cent. One of the really big barriers that we find for first-time buyers is the fact that, increasingly, banks are requiring a 20 per cent deposit. In places like Sydney, that can take up to ten years to save that deposit; in places like Melbourne, up to eight years.
So, the First Home Loan Deposit Scheme brings that forward by many, many years for those people by allowing them to purchase a home with a deposit of 5 per cent and you're right, Tom, it also saves them lenders mortgage insurance which, in some cases, can be in the tens of thousands of dollars. So, it has been a very popular scheme. I expect it will be popular again as from today. So, of course, my advice would be if you've been thinking about purchasing your first home, you've put together a modest deposit; well, actually, you might be able to press the button with the assistance of the Morrison Government's First Home Loan Deposit Scheme.
Connell:
What about those watching who might have just come out of school and still be a few years away from this? Is this a program that could continue indefinitely? If it's been so successful so far, and you know, the hardest part is getting a deposit up and running. Can you give them some sort of hope that this might be something that's in the budget every year?
Sukkar:
Yeah, I’d expect that this will be a feature of the Morrison Government's policy prescription going forward for helping people get into a first home. This is not the only thing. We put in place, some years ago, a scheme called the First Home Super Saver Scheme which helps people accelerate their savings through their superannuation effectively by giving them a salary sacrifice tax cut. And of course, more recently, Tom, as part of our Covid-19 response, we announced a $25,000 grant for those who are purchasing a new home.
So, I'd say to those people, the Morrison Government is a Government for first home buyers and between the First Home Super Saver Scheme, the First Home Loan Deposit Scheme – which has 10,000 places being released today – and of course the HomeBuilder $25,000 grant that we've got today – that if you package up that suite of assistance, there's hope for literally thousands of Australians to get into their first home, where they might otherwise not be able to.
Connell:
So, HomeBuilder, that scheme is nearly a month old now. How many applications have you had?
Sukkar:
Well we've had over half a million hits to the website and 36,000 registrations. We've signed-on every single state – other than Queensland – through the national partnership agreement. So, we've now got the vast bulk of the country administering the scheme through their revenue offices. Again, this has proven to be extraordinarily popular and we'd expect between now and 31 December, that not just first-time buyers, but many Australians will utilise the HomeBuilder scheme to purchase that new property, to undertake a substantial rebuild of an existing property. Let's remember, one great benefit of that scheme is helping first home buyers particularly, get into the market, but the primary focus of the HomeBuilder scheme is to support the hundreds of thousands of jobs in the residential construction industry. I think there's no doubt now, Tom, that this program is going to do that, in conjunction with a number of state-based schemes, where they've really backed in the HomeBuilder scheme and added their own, including Tasmania and Western Australia.
Connell:
The scepticism about this was the renovation or rebuild aspect of it. Have you had any applications yet for people wanting to go about accessing that particular fund?
Sukkar:
I think the early evidence, Tom, is that there's not going to be any shortage of people who are going to undertake a substantial rebuild of an existing property. Again…interrupted.
Connell:
What does that mean? Hundreds or thousands over the next few months?
Sukkar:
There’ll be thousands, Tom, there's no doubt there’ll be thousands of people who take up that opportunity. Let's remember that the focus of this scheme is to support and to encourage and to give people the confidence they need, to either purchase that new house-and-land package, or new apartment, or new townhouse or alternatively, undertake a substantial project on an existing property that employs multiple trades, that is a large project, that has a big economic dividend. I think that the early evidence from the Master Builders Association – who have just undertaken a survey of their members – actually is that, ‘yes, we've seen an extraordinary and unprecedented response to the new home-build aspect of the scheme, but equally, the substantial rebuild/renovation aspects of the scheme as well is proving more popular perhaps than even we thought’.
Connell:
Alright well we'll check in and follow-up. There was some scepticism but you're saying that there's more demand than you anticipated. Just finally, on the New South Wales push for tax reform. Included is, of course, the GST – twenty years after it was introduced by a Coalition Government. We've heard Josh Frydenberg previously say that there’s no real interest in this but what's the position? I mean, if the states were to somehow come up with their own proposal on this and drive it, would the Federal Government then look at it, or are you just not interested at all in having the conversation?
Sukkar:
Well, I think the New South Wales Government has said that that's a report to Government, it's not their policy. We of course encourage states – they’re Sovereign in their own right – to undertake tax reforms. As Liberals, obviously, as Nationals, our preference is for simpler, fairer and lower taxes. But in the end, those sorts of questions will be a matter for State Government's, sovereign in their own right. I agree with the Treasurer, there's no great interest from us on that aspect of it, but to the extent that states want to… interrupted.
Connell:
Is that driving it? I mean you talk about simpler, fairer taxes, which is often spoken about – the GST could be that. Is it just that you don’t want to drive the conversation because there's not much point unless you've got the states on board?
Sukkar:
Well, no, I mean right now, Tom, we're in the middle of pretty extraordinary economic times. So, we're absolutely focused on the immediate needs of the country, the immediate need of Australian families, and that's our primary focus at the moment. But as far as states considering ways that they can make their own tax systems better; they are sovereign in their own right and they should be free to do that.
Connell:
Okay, Michael Sukkar, thanks for your time.
Sukkar:
Good on you, Tom. Thanks so much.