SA first home buyers set to lose out on $25,000 grants due to building delays

More than 1200 SA first home buyers could lose grants of up to $25,000 because of delays out of their control, sparking calls for governments to show compassion.

More than 1200 South Australian first home buyers could lose grants of up to $25,000 because industry-wide building delays will disqualify them from the federal government’s HomeBuilder program.

The federal and state governments have blamed each other for a cutoff that will require applicants to submit all supporting documentation by April 30 in order to receive the grant.

For new builds and substantial renovation contracts that includes proof that construction on the property has started.

However, for new and off-the-plan homes, applicants must submit a certificate of title, which can only be issued after construction on the property has finished.

The requirement will disqualify applicants who bought properties off-the-plan in developments that would have been completed in time if not for lengthy construction delays.

Holly Russell, 25, bought an off-the-plan apartment in the Norwood Green development on the site of the former Caroma factory on Magill Rd.

Ms Russell, a nurse, said she signed the contract in December 2020 and met the eligibility requirements for a $25,000 grant under the HomeBuilder program.

She was not made aware of the April 30 grant deadline until late last year, after construction of the apartment was “extremely delayed”.

“My building was meant to be built by April last year, so if that was the case then I would have already moved in and I wouldn’t have had to worry about it,” she said.

“I think it’s really unfair.”

Holly Russell is urging governments to extend the HomeBuilder grant deadline for first home buyers in her situation. Picture: Emma Brasier

Ms Russell estimated that loss of the grant would add about $37,500 onto her mortgage when lenders’ mortgage insurance and interest is taken into account.

She called on the governments to show compassion and extend the deadline for first home buyers in her situation.

“All these people who are young, like me, and trying to get into the property market when it’s crazy and interest rates are ridiculous and then this happens and no one seems to care,” she said.

“If I knew this was going to be the case, I probably wouldn’t have bought in the first place.”

In a statement, a government spokeswoman said RevenueSA currently has about 1270 applications for which all supporting documentation has not yet been submitted. It is unclear how many of those will be able to meet the April 30 deadline.

The spokeswoman said HomeBuilder was a Commonwealth government initiative administered in SA by the Commissioner of State Taxation and RevenueSA.

She said eligibility criteria was set by the Commonwealth government in accordance with the National Partnership Agreement (NPA) between the Commonwealth, states and territories.

“As the eligibility criteria, and in particular the scheme dates, were set by the Commonwealth government, and SA is bound by the terms of the NPA, there is unfortunately no scope or discretion for the Commissioner, the Treasurer or the Department of Treasury and Finance to extend scheme deadlines,” she said.

She said the government cannot provide contractual or commercial advice to applicants, “who are encouraged to discuss the construction of their home with their builder”.

However, a federal government spokeswoman said the states and territories had agreed to the eligibility criteria, and they had the final say on whether an application would be approved.

“In administering HomeBuilder on behalf of the Commonwealth, states determine the evidentiary requirements to satisfy themselves that an applicant has met the criteria,” she said.