Our latest insight to the HomeBuilder grant as we approach the back end of 2020 and the current December 31 deadline.

Posted in: Insights


The $25,000 HomeBuilder Grant was launched back in early June and is available until the end of this year. It was put in place to drive economic activity across the residential construction sector. The grant is available for owner occupiers who are ‘substantially renovating’ or building a new home to live in. The grants are only available to Australian citizens and are means tested, with the Government setting income caps of $125,000 for single borrowers or $200,000 for joint borrowers. Construction must commence within three months of signing the build contract, which in the case of a new home means the slab must be down.

Whilst enquiries for the grants have been very strong, along with much promotion from building companies, it’s progress and the number of grants approved has been extremely low due to a lack of Lenders accepting the grant as part of funds to complete the project.

The issue largely comes down to the fact that Lenders are not able to be made appointed agents for the grant, unlike the First Home Owners Grant (FHOG), where they can manage the funds and ensure they are counted as part of the deposit, or initial equity towards the project.

As a consequence, many borrowers have found themselves either not being able to proceed with the project or relying on borrowed or gifted funds from family to make up the shortfall.

Whilst the HomeBuilder Grant is a federal initiative, responsibility for implementation and processing has fallen on each state’s Revenue Office. At last count, less than 200 applications had been processed by Revenue SA, with not many more than that processed nationally.  Well short of the expected demand and federal budget allocation.

With only three months to go until applications for the grant close, it’s pretty clear that it hasn’t achieved the aim. Whilst there has been some hope of an extension or changes, only time will tell. A few changes the Government could consider to make it more accessible and potentially achieve the aims of the program include the following.   

Firstly, if the Grant is being used for construction of a new home, adopting the same process as the FHOG, whereby the Lender is appointed agent to manage and disburse the funds would mean the $25,000 could be included in funds to complete. Secondly, widening the eligibility to include permanent residents would see more potential first home buyers become eligible. Increasing the time for construction to commence from the current three months to six months would also help negate issues relating to weather delays, council approvals, etc.  

And lastly, an extension of the program for another 12 months would see a program that was designed to do great things, actually achieve its aim.

For details on the HomeBuilder Grant you can visit Revenue SAs website.

If you have any further questions about financing your build or extension, please contact our experienced Mortgage Broking team on 8300 8300.