The federal government is expanding three homeownership programs due to end in June, with double the number of spaces on offer to help buyers enter the housing market.
- Builders say waiting lists for new homes are already up to a year long and will increase further if new incentives increase demand
- Industry members warn this could exacerbate an existing residential land shortage in regional areas
- Calls for more social housing and rent relief went unanswered in the federal budget
The Regional Housing Guarantee (RHG) announced in Tuesday’s federal budget will allow eligible applicants to build or buy newly built homes in the region of Australia with just a 5% down payment.
From October this year until June 30, 2025, the program will offer 10,000 places a year to first-time home buyers, people who have not owned a property in the past five years and permanent residents.
But there are concerns about the impact this will have on the housing shortage in the regions.
The chief executive of Horsham’s CHS Building Group, Tim Hopper, said there was currently a wait of up to two years for a new home in the western Victoria town.
“You would have a couple [of inquiries for new home builds] a month.”
With regional builders busier than ever, and some out of action with COVID, or as close contacts, in any given week, Hopper said it remained to be seen if wait times for construction would increase further.
“Materials [shortages] aren’t as bad as a few months ago, but… you’re talking about four to five months,” he said.
“Even if you need a working time, it’s also five to six months.
“The problem is that the politicians have to win a seat in the next few months, so you can see what’s going on.”
A developing problem
Matt Bowles, Bendigo realtor and local president of the Real Estate Institute of Victoria, said the regional town is facing a shortage of developed land.
“At one point we would have had over 200 blocks of land for sale in our office itself,” he said.
“At the moment we have three titled blocks available, or three blocks that you can actually buy and pay for.
There are also concerns that regional areas are becoming less affordable and accessible.
Mr Bowles said house prices in Bendigo had soared.
“Now there are very few homes available below that $500,000 figure,” he said.
“On the outskirts of Bendigo, you pay around $350,000 for a block of land.
“In Marong, resales of small residential buildings are still around $250,000 to $270,000.”
The social housing crisis persists
In North West Victoria, the Yarriambiack Shire Council is awaiting the outcome of two funding applications to secure 39 social and affordable housing units in several towns.
Some of these are offered to be delivered in partnership with Haven Housing Service; Home, Safe.
Mayor Kylie Zanker said housing availability was as big a barrier as affordability.
She said partnerships and collaboration with the community could help address these issues so the area doesn’t miss out on the benefits of home buying incentives.
“Supply equaling demand will always be difficult,” she said.
“Some of the units we are looking at building are one and two bedroom units…some [for] people retiring to move into smaller units, which will free up more units in this regard.
“His [about] how we plan to move forward to make the transition as smooth as possible for everyone.”
Ms Zanker said Warracknabeal, the county’s main town of 2,000, had felt the effects of the pandemic tree shift, with four people walking alone on its street in the past 18 months.