New housing affordability fund to help out homebuyers

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A new $512m Housing Affordability Fund (HAF) launched by the Housing Industry Association (HIA) is expected to inject the much–needed boost for struggling property buyers through lower purchase costs of a new dwelling.

The HAF initiative, aimed at improving housing affordability in Australia, is expected to cut red tape and reduce unnecessary costs and delays on new residential development, according to Ron Silberberg, managing director for HIA. “This should reduce the price of new homes for consumers,” he said.

According to the HIA, if an application by a developer (and their local or state government) with the HAF were to achieve a $20,000 saving, the financial benefit for consumers purchasing a new dwelling in the same development could be around $50,000 over a 30–year mortgage.

Silberberg says that at present, builders and developers are unable to get a basic entry level new residential dwelling on the market that the average homebuyer can afford.

“Local governments imbed charges for community and social facilities in new housing developments. This could be local roads, libraries, childcare facilities or other infrastructure. So with the HAF, the Commonwealth will make a financial contribution to the production of these sorts of facilities and, in turn, spread the load. If the applicant obtained the grant money, the consequential savings will have to be passed through in the ticket price of a house and land package,” explained Silberberg.

“There’s a real opportunity to improve housing affordability by getting a more efficient and timely planning system. The costs associated with delays, together with the complexity of many current planning schemes, are unnecessarily high and must be reduced.”

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