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Recently, Prime Minister Scott Morrison announced a $25,000 stimulus grant for eligible owner-occupiers who wish to build a new home or substantially renovate an existing dwelling. The package was introduced as part of the Federal government’s economic response as a result of Coronavirus.
This tax-free grant has been introduced to stimulate the construction sector and ease lull periods in recent months due to Coronavirus and has been welcomed by many in the industry with open arms.
But, what are the requirements and are you eligible for the grant? We’ve put together a list of questions we’re being asked to help our customers identify if they’re eligible and how they can access it.
Am I eligible for the HomeBuilder Grant?
In summary, you must live in the house you’re building or substantially renovating in addition to the following criteria.
Other eligibility requirements include:
- You’re an Australian citizen of 18 years old and over.
- You are an individual. You can’t access the grant through a trust.
- You earn less than $125,000 per year for individual applicants and less than $200,000 combined per couple (based on 2018-19FY or later).
- You have to spend between $150 000 and $750,000 on a renovation for a house worth less than $1.5 million.
- You wish to build a new home with a value of less than $750,000, including land value.
It’s important to note that this tax-free grant applies to all building types (houses, off the plan, land packages, houses and apartments) and all owner-occupiers, not just first-home buyers. Investors are not eligible for the HomeBuilders Grant.
What builders can I use for the HomeBuilders Grant?
Your builder must be registered and fully licensed according to South Australian law.
As is the case in ordinary circumstances, you must spend some time doing your research. Only consider builders with a proven track record and good reputation, so you know you’re protecting your investment.
What if I own the land I want to build on but haven’t yet signed a contract with a builder?
If you own a property, whether it’s an apartment or a house, and you knock that apartment down to rebuild, this will be considered a substantial renovation. Therefore, your project must fall within the price bracket of $150,000 to $750,000 and under the combined land/house value of $1. 5 million.
Regardless of when you bought the land, and you choose to build a new home, the total combined land/build value can’t be more than $750,000.
When can I access my HomeBuilder grant?
To apply for your HomeBuilder grant, you must enter into a building contract between June 4th and December 31st of this year, with construction starting within three months of the contract date.
With the decision-making process being lengthy and council approval taking time, we recommend starting the process as soon as possible, to avoid missing out.
What documents do I need to have available when applying?
To support your application, you’ll need to provide the following documentation:
- Official proof of identification
- A signed and dated contract between you and your licensed builder
- A copy of their South Australian registration or license
- An official copy of your 2018-19FY (or later) tax return proving you’re under the income cap.
- Any supporting documentation such as approvals, occupation certificates and proof of land value.
Although this grant is a federal government-led initiative, the South Australian government will be handling notifications. If you’re unsuccessful and still believe you’re eligible, you can contact the relevant dispute resolution body to have it appealed.
Will the South Australian government be adding to the package for South Australian residents?
Unlike some state and territory governments, the South Australian government have announced they will be not adding to the $25,000 HomeBuilder package for its residents, or abolishing stamp duty. They’ve, however, expressed more support will be available to SA residents in the coming weeks.
Currently, the SA government offers $15,000 for property buyers who build a new home (valued at less than $575,000). Details on this pre-existing grant can be found here. With the two grants mentioned above combined, first home buyers can save up to $40,000 on their first home (conditions apply), making now a better time than ever to build.
In addition to the above, the South Australian government will not be making any adjustments to the off-the-plan stamp duty concession, which is valued at $21,330 on houses with a value of less than $500,000.
Refer to your state and territory concessions here.
For more information on how to apply for the HomeBuilder grant, or to find out how Mayfair Plumbing & Gasfitting can assist, please contact us today.