The Treasury has announced additional home loan assistant measures to help more Australians become homeowners as part of the 2021-22 budget.
Single parents with dependent children will be able to purchase a home with a deposit of two percent.
It will be under the Family Home Guarantee, which the government will establish to provide 10,000 guarantees from July 1, 2021, to single parents over the next four years.
The New Home Guarantee will also be extended for one more year and open 10,000 places for eligible first home buyers from July 1, 2021. This is in addition to the 10,000 spots currently under the scheme.
First home buyers will also be able to release up to $50,000 in voluntary contributions from their superannuation. This is increased from $30,000.
The National Australia Bank (NAB) welcomed the announcement and said they were excited about the new initiative for single parents.
“We are strong supporters of the scheme and have seen first-hand how it has helped thousands of Australians purchase their first home earlier than they thought possible,” NAB Group Executive Personal Banking Rachel Slade said. “Customer interest has been beyond our expectations from day one.”
Slade said their bank had helped 5,500 Australians over the last 18 months buy their first home through the scheme, during which first homebuyers had entered the market at levels not seen for a decade.
Property Council of Australia also welcomed the announcement, with Property Council Chief Executive Ken Morrison saying it would help the residential housing sector continue to drive the Australian economy.
“These measures build off the economy-saving success of the HomeBuilder scheme by providing more focused support where it is most needed,” Morrison said.
“As stimulus and support measures wind down, the industry will be looking for policymakers to adopt measures which restore the traditional drivers of growth in the housing market, including a return to net overseas migration as quickly as possible.”
However, housing experts are saying the scheme will not help the current housing supply issue and will simply raise the already record-breaking prices.
“That has the effect of raising house prices,” Brendan Coates, director for household finances at the Grattan Institute, told Domain. “Those who benefit from the scheme get a leg up, and for those who fall outside of the scheme—house prices rise, and they become less affordable.”
The government will also provide states and territories with an additional $124.7 million to help boost their public housing supply.