Getting a Home Loan in Australia if you're living overs...
29 Nov 2023
When is the $25k grant available?
Australian homeowners now have the chance to receive a $25,000 gift to put towards the building of your new home or renovations through the Government’s $25k HomeBuilder grant.
However, if you want to take advantage of the grant, you'll need to act quickly or risk missing out, as the deadline to get contracts signed for the work to begin are tight. We’re here to break down when you need to apply, eligibility criteria, and how you can make the most of the $25k.
The $25k grant will only be offered for contracts entered into between 4 June 2020 and 31 December 2020, and construction must be contracted to begin within three months of the contract date to be eligible.
To be eligible, you must:
Be an Australian citizen aged 18 years or older and be an individual, not a company or trust.
Be on an income of less than $200,000 for couples, and $125,000 for singles.
Be spending between $150,000 and $750,000 on a renovation for a home that has been previously valued at less than $1.5 million.
Be building a new home worth less than $750,000 (this includes land value).
The tax-free grant will apply to all owner-occupiers, not just first home buyers, however owner-builders are ineligible for the scheme, and the scheme will not apply to those who are planning to build a new home or renovate an existing home as an investment property.
All dwelling types (house, apartment, house and land package, off the plan, etc) will be eligible under the scheme.
The grant cannot be used for additions to the property that are not connected to the home, such as swimming pools, tennis courts, outdoor spas and saunas, sheds or garages.
The grant can be used in conjunction with existing state and territory First Home Owner Grant programs, stamp duty concessions and other grant schemes, including the Commonwealth’s First Home Loan Deposit Scheme and First Home Super Saver Scheme.
You will be able to apply for the HomeBuilder grant when the relevant State or Territory Government that you live in, or plan to live in, signs the National Partnership Agreement with the Commonwealth Government.
Information on when and how you will be able to apply will become available through the relevant State or Territory revenue office soon.
It’s important to think carefully about how best to spend the grant money to make sure it goes further and increases the amount of equity in your home, without overcapitalising.
Knock down the walls
Renovation costs can quickly blow out as soon as it becomes a structural reno, especially if you’re knocking down a load-bearing wall.
So for those who hadn’t considered knocking down walls as part of their reno, the grant could help alleviate some of those costs and give you the open plan living you’ve always wanted.
Overhaul the kitchen
A kitchen reno almost always reaps rewards for homeowners when it comes time to sell as buyers are willing to make small changes, like a fresh coat of paint or new floors, but most won’t want to worry about an expensive kitchen reno.
A new kitchen is a great way to spend the $25k, provided you don’t overcapitalise. It’s usually best to spend between 3% and 6% of your home value on the kitchen.
Good quality kitchen appliances are the most important feature in a kitchen, as is tons of storage and a decent sized pantry - especially for apartments which often have very minimal storage space.
Redo the bathroom or build another one
The old adage that kitchens and bathrooms sell houses rings true as they’re big-ticket items and spaces that people will be most concerned about spending money on when buying a house.
An extra $25k to spend could go towards adding an extra bathroom, especially if you’re adding more bedrooms. An en-suite should also be a high priority item for any property if you don’t already have one.
Double vanities, walk-in showers and a stand-alone bathtub are items lots of buyers will look for in a property.
Use an architect or interior designer
If you’re building a new home or renovating an existing one, the $25k grant could be spent towards an architect or interior designer to make a substantial impact on your home.
An architect can give you clarity about what you should or shouldn’t do with your home, and what materials would be best.
If you want your home to look like something from the pages of Vogue Living, an interior designer can create a well-considered space that allows you live and work better and add to the value of your home.
Build an extension
If you need extra space for a home office, more living space or extra bedrooms and you have council approval, building an extension could be another great way to spend the $25k grant.
You could also add a pool - but it must be connected to the house in some way to be eligible for the grant. So an indoor pool for year-round swimming could become a reality!
You might also want to consider spending the $25k grant on energy-efficient upgrades to your home, such as solar panels, insulation, or energy-efficient appliances.
If you're ready to start your home building journey, check out some of our construction loans, or book an appointment with one of our friendly lending specialists to organise your loan pre-approval.
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