Victorian state budget: Homebuyer Fund to get $700m shot in the arm, before being dumped
Victorian homebuyers are facing a budget blow after Treasury slated a key affordable housing assistance program for the chopping block.
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Victorian homebuyers are facing a budget blow after Treasury slated a key affordable housing assistance program for the chopping block.
While the Victorian Homebuyer Fund will get a $700m shot in the arm in the coming financial year, it will be dumped at the end of that time in favour of a federal program that has yet to be approved by parliament.
The VHF works by allowing homebuyers with an at least 5 per cent deposit to have the government co-purchase up to 25 per cent of a residence with them, reducing the size of a deposit they need to save and the size of their mortgage.
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A $700m boost for the coming 12 months will particularly benefit regional homebuyers, with the cap on the program to be increased from $600,000 to $700,000. In Melbourne and Geelong the cap is unchanged at $950,000.
Single parents will also be able to earn up to $208,775 before being excluded from the scheme, up from the current $130,485 single income cap.
But only until next year when the federal government’s Help to Buy scheme is expected to replace the Victorian offering.
While the federal government’s Help to Buy scheme proposes to give buyers up to 40 per cent of their home purchase price in a co-buy arrangement, latest details have set caps of $90,000 income for single earners and $130,000 for joint buyers.
The Albanese government proposal, which is yet to be approved by the federal parliament, also stipulated an $850,000 cap for purchases in Melbourne and a $550,000 price limit for regional homes.
It was also expected to have just 40,000 places available nationwide across four years. The Victorian Homebuyer Fund had more than 10,000 places available in its first two years.
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Treasurer Tim Pallas said the Victorian expansion over the next year would add to the more than $1bn in concessions already available to those looking to buy an affordable home, including the state’s first-home buyer stamp duty concessions and First Home Owner Grant.
Mr Pallas noted that reduced infrastructure spending was also expected to benefit housing construction, with less competition from government projects for the trades and materials needed to build homes.
A $107m boost in funds for the state’s housing agenda was also announced.
It includes $63m to be spent on beefing up the state’s construction watchdog and regulator, the Victorian Building Authority. It promises a 50 per cent increase in the number of regulatory officers seeking out and dealing with dodgy operators, as well as boosting access for Victorians building new homes and undertaking renovations to access Domestic Building Insurance.
An extra $197m will also be injected into frontline homelessness services, with $115m of that funding to go to grant services that help break the homelessness cycle in a four-year program starting from the 2025-26 financial year.
A further $19m has been set aside for a new system to facilitate repairs and maintenance on existing public housing. Another $15m is in the budget to assist First Nations Victorians to access housing.
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