Fact checked
Housing policies are among the deciding factors for many Australians who voted over the weekend.
With the apparent victory of the Australian Labor Party (ALP)’s Anthony Albanese as the 31st Prime Minister, here are five key housing policies to be expected this year:
1. Help to Buy scheme
Headlining Labor’s housing plans is the Help to Buy scheme, which aims to get more people into the housing market by cutting the cost of buying a home by up to 40%.
The scheme, which is expected to help 10,000 Australian homebuyers, will see the government shoulder up to 40% of the purchase price of a new home and 30% of the value of an existing home, taking a proportional stake in the target property.
With the government’s support in place, eligible homebuyers will only need a deposit of at least 2% to apply for a home loan. Even with this low deposit, homebuyers will not be required to pay for Lenders Mortgage Insurance (LMI).
This scheme will also lower the monthly mortgage repayments — a homebuyer in Sydney, for instance, who is buying at the maximum price cap of $950,000 with 40% equity, will have monthly mortgage repayments that would be over $1,600 cheaper.
When eligible homebuyers exceed the income thresholds set by the scheme for two consecutive years, they will be required to repay the government contribution in part or fully as their circumstances allow.
However, during the loan period the homebuyer can voluntarily buy an additional stake in the property when they are able to do so. The minimum stake that a homebuyer can opt to purchase at any one time is 5%.
While the Labor Party expects the scheme to open homeownership to more Australians, Zippy Financial Director and Principal Broker Louisa Sanghera said existing schemes that have similar benefits tend to be unsuccessful for lower income households.
“While the Help To Buy scheme is commendable, borrowers attempting to tap into existing policies that reportedly only require a two per cent deposit, such as the Family Home Guarantee for single parents, have still not been able to secure finance in our experience because of their lower incomes,” she said.
“Borrowers wanting to apply for the Help To Buy program should try to save more funds to put towards their deposits as well as reduce credit card limits and debts to improve their chances of qualifying for a mortgage.”
2. Regional First Home Buyer Support Scheme
Labor’s Regional First Home Buyer Support Scheme aims to help 10,000 first-home buyers in regional markets to buy a home by providing guarantees of up to 15% of the property’s price.
The scheme, which works similarly with existing housing support programs, will be specifically catered to homebuyers who live outside the capital cities.
With the scheme, buyers will only need at least 5% home loan deposit. They will not be charged with LMI.
Existing houses, townhouses and units will be part of the scheme. Along with house and land packages, off-the-plan apartments and land with a contract to build.
The scheme is expected to start in January 2023.
3. National Housing Supply and Affordability Council
In an effort to address housing supply concerns across the country, the government will set up a National Housing Supply and Affordability Council, which will be advised by experts from a diverse set of fields including finance, economics, urban development, residential construction, urban planning and social housing sectors.
The council’s primary objective is to set targets for land supply in consultation with state and territory governments, as well as collect make public on a regular basis nationally consistent data on housing supply, demand and affordability.
Along with this comes the development of the National Housing and Homelessness Plan — key stakeholders including states and territories, local government, not for profit and civil society organisations, industry bodies, superannuation funds and other experts in housing, finance and urban development will be involved in coming up with the set of reforms.
4. Housing Australia Future Fund
The incoming Labor government aims to create a $10 billion Housing Australia Future Fund, which will build 30,000 new social and affordable housing properties in its first five years and create thousands of jobs.
Over the first five years, the fund is expected to build 20,000 social housing properties, 4,000 of which will be provided to women and children fleeing domestic and family violence and older women on low incomes who are at risk of homelessness.
Another 10,000 affordable homes will be built and will be provided to frontline workers like police, nurses, and cleaners.
The fund is expected to support 21,500 full-time jobs across the construction industry and broader economy annually over five years.
5. Funding restoration for homelands and improvement of remote housing
The incoming government leadership will provide an immediate funding of $100m for housing and essential services on Northern Territory homelands. This funding will cover improvements to water, power and community facilities, as well as housing upgrades, extensions, and new builds.
The government will also negotiate a new remote housing agreement with the Northern Territory that includes homelands, when the current agreement expires in mid-2023.
Furthermore, the government aims to provide a $200m from the the Housing Australia Future Fund for repair, maintenance and improvement of remote housing in Western Australia, South Australia, Queensland and the Northern Territory.
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