What are the benefits for homebuyers and investors, and are renters any better off?
The announcement of the 2022 Federal Budget in March brought about many questions on what this meant for everyday Australians. For home buyers, renters, and investors, changes to the federal budget can mean big wins or big losses. So what are the 2022 Federal Budget benefits for homebuyers and renters?
Home Guarantee Scheme Expanded
With the cost of housing and rental prices sky high across the country, making housing more affordable has been high on the government’s radar. A few measures have been taken to alleviate this, in both short and long-term measures that many homebuyers will be happy about.
Firstly, the overarching benefit to homebuyers is the expansion of the Home Guarantee Scheme. This scheme has been turned into a three-prong system, with ‘guaranteed’ home loans being given to first homebuyers, regional homebuyers, and single-parent families.
Formerly, the initiative allowed 25,000 eligible applicants the opportunity to secure a home loan with only a 5% deposit, and avoid paying expensive Lender’s Mortgage Insurance (LMI). The government acts as the guarantor for the remainder of the deposit, which makes homeownership much more affordable for the lucky recipients.
In the 2022/23 budget, the initiative has added additional places; an extra 10,000 to the First Home Guarantee, 10,000 to the Regional Home Guarantee, and 5000 for the Family Home Guarantee. The recipients of this home loan assistance will be means-tested, and subject to price caps on the properties they’re able to purchase.
The Regional Home Guarantee
For those considering a sea or tree change or already living in regional towns, this scheme is open to anyone who hasn’t owned property in five years. This differs from the First Home Guarantee, which is only available to first home buyers.
10,000 lucky applicants will be granted the ability to purchase a property with a 5% deposit and pay no LMI, with the government providing the guarantee for the remaining 15% deposit. Purchasing property in regional areas can be an excellent investment opportunity. While the Regional Home Guarantee is only available to owner-occupiers, buying in the right location could see your property increase in value in the coming years.
The Family Home Guarantee
Single-parent families with at least one dependent child will be able to access one of 5,000 additional places in the Family Home Guarantee. These places allow the recipients to secure a home loan through an approved lender with a deposit as low as 2%.
This will make stepping onto the property ladder much more achievable, which for many single-parent families can be a difficult task.
Negative Gearing To Stay
Negative gearing is often the subject of political chatter, and property investors will be pleased that it’s here to stay for the duration of this budget. The removal of negative gearing could result in fewer rental properties available on the market and higher rental prices.
Tenants No Better Off
Unfortunately, nothing has been done about the price of rent. Tenants will be disappointed that the government hasn’t committed to assisting in reducing rental prices. The one-off tax break will surely be a small help for some, but won’t bring the ongoing change many were hoping for.
How Buyer Tenant Agency Can Help You Maximise The Federal Budget Changes
As property buyer’s agents and tenant advocates, we’re passionate about fighting in your corner to secure the best deal for you!
How We Assist Homebuyers
If you’re a home buyer or a property investor, our team of buyer agents are here to help you make the most of the Federal Budget changes. By finding the right property for you, and negotiating on your behalf, we can help you maximise your opportunity and profits.
How We Assist Renters
During rental shortages, finding a property can be daunting, so working with independent tenant representatives can help you navigate through the rental crisis. As tenant representatives, we assist renters to find a rental property and negotiate the rental price, terms and conditions.
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