Key updates have been released relating to the HomeBuilder scheme.
Australians hoping to get the $25,000 HomeBuilder grant could be waiting years for the cash after guidelines for the scheme were updated this week.
In one of the biggest updates since the program was announced over a month ago, the Victorian State Revenue Office released key updates and a few warnings.
Buyers risk missing the grant if their builder takes on more work than is “reasonable” or they quit contracts signed before June 4 hoping to cash in.
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With the scheme being administered by State Revenue Offices around the nation, it is expected the guidelines could be applied across the country.
They also confirm applicants will be shelling out thousands of dollars in their own money before they receive the grant and indicate off-the-plan unit buyers will wait until their name is on the title to be paid.
As a result, the federal government could still be making HomeBuilder payments to buyers at large-scale developments and apartment towers until October 31, 2022.
Towers in major capitals like Melbourne can take years to build. Picture: David Caird.
The HomeBuilder grants are on offer for those building a new home for under $750,000 or renovating their existing home for between $150,000 and $750,000, subject to income criteria. They are only available for buyers who sign contracts between June 4 and December 31 this year, and construction must start within three months of the contract being signed.
WHEN DO YOU GET THE MONEY?
Different projects will get the government funding at different times.
- HomeBuilder payments will be made directly to an applicant’s nominated bank account at different points, depending on the project:
- New house builders receive the funds after the foundations have been laid and a first progress payment is made to a builder.
- Renovators will get the cash after they submit evidence of payments covering at least $150,000 of the contract price.
- Off-the-plan project buyers will not be paid the $25,000 until their name is registered on the certificate of title, with a deadline of October 31, 2022, now in place.
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WARNING ON DELAYS
You will need to know what a “reasonable” amount of projects for your builder to have is.
The SRO has now defined commencement as “excavation and site preparation works” for any new builds, and works “under the renovation contract” for existing homes.
An earlier promise of extensions if delays were encountered has now been clarified, with the SRO Commissioner “unlikely” to be lenient if the delay is caused by a buyer failing to “undertake appropriate due diligence when entering into a contract”.
Industry groups have been lobbying for further clarity and timeline details since June 4
This includes if the builder contracted to build the home has more work lined up than could be “reasonably expected” to be finished in the three months, and if a developer has set pre-development sales targets that have not been met yet.
They are “likely” to be covered for delays caused by council approvals, obtaining materials or subcontractors, bad weather or industrial disputes.
Natural disasters and serious illness or death in the construction team could also lead to an extension.
The guidelines also appear to slam the door on homebuyers who cancelled contracts signed before June 4 this year in a bid to access the grants, warning such applicants “you may not be eligible to receive the HomeBuilder grant”.
READ MORE ON INDUSTRY REACTION AND WHAT’S TO COME HERE.
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