The Real Estate Institute of Queensland (REIQ) has joined the growing calls for the extension of the HomeBuilder scheme and the expansion of the First Home Loan Deposit scheme.
The federal government needs to consider the whole real estate sector when introducing stimulus measures, said Antonia Mercorella, CEO of the REIQ
"By doing so, it will help drive consumer confidence upward, accelerate our economy and increase the labour market across both construction and real estate, two of Queensland’s largest industry employers," she said.
Mercorella believes that without extending the HomeBuilder scheme, builders will not be able to keep up with the demand from existing applicants. Given that every approved sale under the scheme must have financing in place and council approval by 31 December, the pent-up demand appears to be resulting in an increase in building costs.
"That shouldn't be happening in this environment," she said. “Despite relatively stable market conditions, low interest rates and high levels of demand, it appears to not be enough to sustain new residential construction.”
In fact, the costs of new construction had already risen by 220.3% from 1995 to 2018, while the costs of established housing had increased by only 114% over the same period.
Also read: Five Questions About HomeBuilder Grant Answered
Furthermore, the increase in the costs of dwelling construction makes it necessary for the federal government to consider removing the limits of the extension of the First Home Loan Deposit Scheme and allow the purchase of established homes, Mercorella said.
"For the federal government to overlook established housing is disappointing considering the original scheme included established residential dwellings," she said.
Mercorella said the original set up of the deposit scheme provided buyers with a wider range of affordable options since the purchase of established homes was allowed.
"Without comprehensive stimulus measures that extend to established housing, it’s likely to exacerbate artificial price hikes in an already volatile climate, making it increasingly difficult for many buyers to purchase property," she said.
