HomeBuilder Grant deadline looms, leaving off-the-plan home buyers at risk of losing their $25,000 grant

Buyers in the ACT, Victoria and South Australia are urging the government to extend the April 30 deadline for the HomeBuilder Grant, to ensure they receive the payment they were previously deemed eligible for.

Meanwhile state and federal governments are shifting the blame and holding firm on the deadline.

The HomeBuilder Grant was announced by the Morrison government in June 2020 and was to be administered by state and territory governments.

It offered owner-occupiers $25,000 to put towards a new-build home, including off-the-plan properties, or a substantial renovation for contracts between June and December 2020. A $15,000 grant was available for contracts entered into from January to March 2021.

The scheme effectively has two deadlines. The first, which has now closed, was that construction must have commenced within 18 months of the contract date.

The second deadline, April 30, 2023, is the date in which buyers must submit all supporting documents to their state revenue office.

For off-the-plan applicants, the grant is paid once the buyer shows evidence of a certificate of title, which is issued upon settlement of their property.

With construction delays plaguing developments all over the country, many settlement dates are likely to be pushed beyond the deadline - forcing buyers to find their own $25,000 to cover the gap.

The announcement of the grant prompted Canberra resident Meghan Bergamin to start looking for a townhouse. She paid a deposit for a property at the Otto development in Denman Prospect in December 2020 and was told her home would be completed in by the end of 2021.

She was eligible for the $25,000 grant, which was spruiked by the developer and real estate agent, and it meant she could afford a larger, three-bedroom townhouse.

"[I thought] if I get this HomeBuilder Grant then I can actually have that bit of extra space that I wouldn't have been able to have otherwise," Ms Bergamin said.

Since then COVID-19 lockdowns, availability of tradespeople and material shortages have delayed the project. Settlement is now more likely to occur in mid-2023, meaning she will miss out on the $25,000.

"I've been renting all that time," Ms Bergamin said.

Alex Hatton is a first home buyer and also purchased a townhouse in the Otto development. He is relying on the grant to pay back money he withdrew from his superannuation as part of another federal scheme, the First Home Super Saver.

"I actually took money out of my superannuation to put down a deposit on this house believing that it was a good investment and that I would be receiving that $25,000 back through the HomeBuilder Grant," he said.

Mr Hatton stressed he was not asking the government to approve new grants, but to pay out the funds it had previously allocated.

"It's not people jumping on the bandwagon," he said.

"It's people that believe they had that entitlement for the last couple of years and it's only through delays that weren't their fault that they [could] miss out on a substantial amount, which is about 5 per cent of my property's value."

Off-the-plan buyers have come together to urge the government to extend the deadline. Some have written to their local or state politicians, others have written to Federal Housing Minister Julie Collins.

A petition to extend the deadline had received nearly 400 signatures as of Friday.

Lisa MacKinven lives in Langwarrin, about an hour's drive south-east of Melbourne CBD. After hearing about the grant, Ms MacKinven signed a contract for an off-the-plan townhouse in August 2020, with an estimated completion date of March 2021.

After submitting her initial documentation for the grant in early 2021, the townhouse development has been hit with "delay after delay after delay", she said.

Now she fears her home won't be completed in time to receive the "life-changing grant" she thought she was eligible for.

In Adelaide, Evan Katis signed a contract for an off-the-plan home in December 2020. He received a confirmation letter from RevenueSA that he was eligible for the grant but there was no mention of a deadline to submit the certificate of title.

Without the $25,000 grant, Mr Katis is worried he will face financial stress.

"I would really have to turn to my support network to borrow money, putting myself in financial stress," he said.

The grant program was expected to provide around 27,000 grants at a total cost of around $680 million, however numbers were not limited and the budget was not capped.

As at March 7, 2022, $2.1 billion in grant payments had been made under the program, Treasury data shows.

More than 80 per cent of the 137,755 national applications by February 2022 were for new-build homes.

The ACT government confirmed of the 2939 applications it received for the HomeBuilder Grant, 1839 had so far been paid.

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An ACT government spokesperson said states and territories entered an agreement to administer the grant in line with the federal government's terms, conditions and eligibility criteria.

"The Australian government set a deadline of 30 April 2023 for applicants to qualify for the HomeBuilder Grant," the spokesperson said.

"The Australian government has recently advised all state and territory revenue offices that they will not be providing any extensions and it is their intent that HomeBuilder will continue as designed by the former government.

"The ACT government has no discretion in this matter."

Federal Housing Minister Julie Collins did not respond to questions put to her office by ACM, however a Treasury spokesperson provided the following statement:

"HomeBuilder is administered by the states and territories under the terms of the National Partnership Agreement on HomeBuilder."

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