‘Our phones will start ringing again’: ACT and federal governments announce property incentives to boost construction industry

Stamp duty will be waived or reduced for residential land and off-the-plan apartment and townhouse purchases in the ACT in a bid to create and support jobs in the property and construction sector.

This comes as the federal government announced its “HomeBuilder” scheme on June 4, worth around $680 million, which will give owner-occupiers (not just first-home buyers) a $25,000 grant to build a new home or substantially renovate an existing home.

The ACT’s latest announcement forms part of Canberra’s Recovery Plan and will see stamp duty for new land, single residential blocks waived, as well as off-the-plan apartments and townhouses up to $500,000.

Meanwhile, off-the-plan apartments and townhouses priced between $500,000 and $750,000 will see stamp duty reduced by $11,400.

The concessions will be available from June 4 until June 30, 2021.

“The ACT’s local construction industry employs and supports tens of thousands of Canberra families … This initiative will encourage growth in the residential property construction sector to create and support jobs,” said ACT Chief Minister Andrew Barr.

“These measures will save new home buyers thousands of dollars whether they are entering the housing market for the first time, or looking to move.”

The state government will also extend the Pensioner Duty Concession Scheme for one year.

This scheme provides a full or partial stamp duty concession to pensioners purchasing a home valued below the median property value. Stamp duty deferrals will also be extended to all pensioners, regardless of property value.

“The ACT government has a strong track record of creating jobs and supporting a growing local economy.  Our Recovery Plan will draw upon this experience, ensuring our city gets through the greatest challenge we have ever faced,” Mr Barr said.

The latest announcement complements the federal government’s package, which is expected to support 140,000 direct jobs and another one million related jobs in the residential construction sector.

Under the HomeBuilder package, individuals earning less than $125,000 or couples with a combined income of less than $200,000 will be eligible for the grant but are not able to purchase an existing home.

A national dwelling price cap of $750,000 will apply for new home builds, and a renovation price range of $150,000 up to $750,000 will apply to renovating an existing home. 

For substantial renovations, the value of the house must not exceed $1.5 million before the renovation and excludes sheds, pools, granny flats and other structures attached to the home.

The scheme will be available from June 4 until December 31, 2020. Construction for a new home or significant renovation must be contracted to begin within three months to avoid a rise in house prices.

Master Builders ACT chief executive Michael Hopkins also welcomed the announcements, noting that they would provide a “much-needed lifeline” to the building and construction industry.

“For every $1 invested in home building activity, $3 is provided to the wider economy, meaning that this announcement will have a positive flow-on effect to many other industries and will provide a boost for thousands of tradies; the cafes, pubs, and ute dealerships that they frequent; as well as the thousands of building supply businesses that depend on the industry,” Mr Hopkins said.

Mr Hopkins said both the federal and state incentives would help support the 20,000 construction workers in the ACT.

At a press conference in Googong this morning, Prime Minister Scott Morrison said the HomeBuilder scheme would “support those families and those Australians whose dream it was to [buy] that house [or] do that big renovation … a dream that they thought might’ve been crushed by the coronavirus”.

“We’re here to tell them that we’re going to keep that dream alive for them and the dream alive of the jobs of the apprentices, builders, tradies and all of those who depend on this critical industry right across the country,” Mr Morrison said.