If you’re planning on renovating or buying a new home, you’ll need quite a lot of resources. However, with the help of a homebuilder grant, you can receive a maximum of $25,000 to build a new home, renovate an existing one, or buy a new home.
A new home is characterized as one that hasn’t been occupied or sold previously. Additionally, the construction should have commenced on or before the 4th of June 2020. With the assistance provided by this grant, your dream home can finally be yours. Here’s everything you need to know about the homebuilder Grant.
Homebuilder Grant: What Is It?
On the 4th of June 2020, the Australian government announced the homebuilder grant, which offers eligible owner-occupiers with a grant of $25,000 to purchase a new or off the plan home, renovate an existing one, or to build an entirely new one. This grant is also accessible for first home buyers.
The contract must be signed between the 4th of June 2020 to the 31st of December 2020, but construction doesn’t need to have started before the 31st of December 2020. However, construction must not have started before the 4th of June 2020 and must commence within three months of the contract’s start date. This contract is subject to the National Partnership Agreement provisions signed between the Australian and Victorian Governments. For eligibility, the maximum property value for renovation cannot exceed $1.5 million. If you want to build a new home, the total expenditure should be less than or equal to $750,000. For renovation, the cost should be between $150,000 to $750,000. The homebuilder grant goes with the existing First Home Owner Grant. These grants are a part of the Australian government’s effort to boost the Australian residential construction market post-covid-19.
What Are The Eligibility Requirements For Homebuilder Grant?
As with any form of a grant or monetary assistance, certain requirements must be met to avail the homebuilder grant. Existing homeowners and first home buyers are both eligible for this grant. At the date of the contract, every applicant must be:
- An Australian citizen
- 18 years of age or above
- A natural person (not trust or company)
When you need to register as the property owner or land on the certificate title, it depends on what type of contract you’re entering into:
- If you want to purchase a new/off-the-plan homes, you need to be registered on the title as the owner of the property after the building is completed, and you’re entitled to ownership of the home
- For renovation works, you’ll have to register when you enter into the contract
- If you want to build a new home, you need to register by the time the foundations are laid or the first payment is made
- You must never have received the homebuilder grant
- After the renovation or construction is completed, you must continuously reside in the property for at least six months.
The homebuilder grant doesn’t apply to investment properties.
Does Homebuilder Grant Have Any Income Gaps?
If you want to apply for the homebuilder grant, you must fulfil one of the following income gaps:
- For individuals, your income must not be more than $125,000 based on your 2018/2019 tax returns or later.
- For couples, the combined income must be less than $200,000 based on the 2018/2019 tax returns.
It is important to note that there’s no limit to the number of people that can avail the grant; however, it won’t be available after the 31st of December 2020.
What Dwellings Does Homebuilder Grant Cover?
If you meet the eligibility requirements, the following dwellings are covered by the homebuilder grant:
- Land & House package
- Building on vacant land
- Off the plan
- Homebuilder grant can also cover pre-fabricated properties if all the other eligibility requirements are met and a licensed builder carries out the construction.
For renovation, the following requirements are necessary:
- A registered or licensed builder must carry out the renovation.
- Renovation must enhance the safety, liveability, and accessibility of the property. As such, shed, court, tennis, swimming pool renovations, etc. are not eligible.
- The renovation must start within three months after the contract date.
What Are The Required Documents For Homebuilder Grant?
You’ll have to furnish certain documents to avail of the loan. The following are the minimum documents that you need to submit:
- To prove your income gap eligibility, you’ll need to furnish a copy of your 2018-19 tax returns.
- A copy of your builders’ license or registration will also be required.
- A copy of the contract dated and signed by you along with the licensed or registered builder
- Proof of identity
- At times, you might also need to submit other documents such as proof of land value, building contracts, or council approvals.
How Do I Apply For The Homebuilder Grant?
The grant is implemented through a National Partnership Agreement signed between the state/territory governments and the commonwealth. As such, you must apply via the place you reside in or plan to reside in once the agreement has been signed.
When Will I Receive The Grant?
Even though it is a nationwide scheme, you’ll receive the grant depending on the territory or state you reside in, provided that you meet the eligibility requirements. The grant is paid after the construction starts. Generally, it is processed through your lender and delivered straight to your builder. However, it is possible to apply directly with your state government in the absence of a lender.
What If My Application Is Rejected?
In this case, you can file an objection. You must file within 60 days after receiving the rejection letter notifying them of the reasons you believe the verdict is incorrect. You can’t place an objection based on perceived unfairness. You must detail the facts as to why you were denied the grant regarding the eligibility requirements.
A homebuilder grant is a fantastic option for purchasing or building a brand-new home or renovating an existing one. However, it does have certain disadvantages. You must be well versed with all the requirements and rules before you apply for this grant.