- The Budget is due to handed down tomorrow at 7.30pm (AEDT)
- Already announced: schemes to assist single parents and first homeowners
- Other measures expected around childcare, aged care, jobs, covid and tax
In a time like no other, even the most fiscally conservative hawk has realised that the government’s job over the past year has been to spend, spend, spend. If this budget is the last one before the next election – tipped for late this year, or early next – then the giveaways are set to continue.
The Australian economy has leapt out of the pandemic-created recession – its first in 30 years – and has fuelled a booming property market, with prices rising at rates not seen since the 1980s.
In some places, those property markets had been depressed for some time, so the current improvement is seen as a relief for many. For others, it has put the idea of homeownership further out of reach.
First Home Owners & Single Parents
To that end, expect something for first homeowners tomorrow. Stimulating this part of town is popular, and creates the first link in the chain effect for the property market. They allow others to sell and move on, and also the home builder market to flourish, creating more jobs and, perhaps, first homeowners.
To get wages rising, and unemployment back to 5%, more needs to be done, and expect Mr Frydenberg to do just that.
Already announced are government-guaranteed ‘transitional’ loans for single parents, allowing them to put up just a 2% deposit. This is seen as particularly helpful for women. According to ABS statistics, 79% of single parents are women.
“The new Family Home Guarantee will be a revolution in providing single custodial parents, the overwhelming majority of whom are women, with a step up to gaining the security that comes with home ownership.”
Denita Wawn, CEO of Master Builders Australia (MBA)
“The Family Home Guarantee will assist single mums to buy a home with a deposit as low as 2%, drawing on the success of the Government’s highly successful First Home Loan Deposit Scheme that allows first home buyers to build a new home with a deposit as low as 5%. It’s great news that this scheme has also been expanded by 10,000 new places,” she said.
Commonwealth Bank CEO Matt Comyn also welcomed the move.
“We know how challenging it can be for single parents to support their family and save for a deposit for a home. This announcement will come as a welcome relief for hard-working single parents, particularly those working in essential services such as education, health care and public safety, looking to buy their first home or re-enter the property market,” he said.
The First Home Loan Deposit Scheme (New Homes) is another “good outcome” which should allow 10,000 places for the next financial year for homes built since January 2021, said the Real Estate Institute of Australia (REIA).
This is in addition to the 10,000 spots under the First Home Loan Deposit Scheme (FHLDS).
“The First Home Super Saver has been lifted from $30,000 to $50,000 and will greatly assist in easing the difficulties this group faces in obtaining a home.
“Expansion of this scheme has long been a priority of the REIA.”
Adrian Kelly, President REIA
The proposed $125 million set aside for social housing is also welcomed by the REIA, the MBA and the Property Council of Australia.
“A further $124.7 million to assist states and territories to meet their social and community housing requirements will help meet growing demand for housing support.”
“As stimulus and support measures wind down, the industry will be looking for policymakers to adopt measures which restore the traditional drivers of growth in the housing market, including a return to net overseas migration as quickly as possible,” said Property Council Chief Executive Ken Morrison.
5 things to watch out for
- Childcare – support for childcare, supports families and boosts female workplace participation rates
- Aged care – after the damning Royal Commission’s findings, a $2.5 billion package is likely
- Jobs and Infrastructure – with the emphasis on defence, small business and digital
- Covid – some sectors are still struggling to recover, so expect some assistance for retail, tourism, CBDs and education
- Tax – something for low to middle-income earners is expected.
The Budget is due to handed down Tuesday 11 May at 7.30pm (AEDT).