2022 budget: What’s in the pipeline for property?
SPI unpacks the latest Federal Budget – and what the Government has in store for property in an election year.
Treasurer Josh Frydenberg looked to underscore the strength of the Australian economy in his speech to parliament introducing the new budget.
Whereas last year’s focus was on “securing Australia’s recovery,” this year the plan focuses on building the nation’s “stronger future”, as the government highlights the gains made by a battered COVID economy.
“The last 2 years have been tough for our country, there have been setbacks along the way. But Australia remains resilient. Australians remain strong. We have overcome the biggest economic shock since the Great Depression,” Mr Frydenberg said.
The Treasurer positioned Australia’s strength on a global scale, claiming, “Our recovery leads the world. Faster and stronger than the United States, the United Kingdom, Canada, France, Germany, Italy and Japan.”
Here are some of the key economic figured the treasurer highlighted:
- Unemployment sits at 4 per cent, the equal lowest in 48 years.
- Roughly 2 million more Australians are in work today than in 2013.
- More women are currently working than ever before.
Mr Frydenberg said this budget represented the “largest and fastest improvement to the budget bottom line in over 70 years,” with this year’s fiscal plan $100 billion better off compared to last year.
The deficit for 2022‑23 is expected to be $78 billion or 3.4 per cent of GDP, while over the next three years, the government projects this figure to more than halve to 1.6 per cent.
Some of the headline measures supported by this year’s budget include:
Housing
As previously reported by Smart Property Investment, with housing affordability a prime issue among voters and first home buyers in particular, the government has made a move to invest big in its Home Guarantee scheme.
This includes expansions of the New Home Guarantee, Family Home Guarantee, and First Home Guarantee (previously known as the First Home Loan Deposit Scheme), as well as the introduction of a new funding initiative, the Regional Home Guarantee, open to non-first home buyers.
- The First Home Guarantee will now accept 35,000 applicants each year, up from the current 10,000, beginning on 1 July 2022.
- The Family Home Guarantee, which previously allocated 10,000 places over a four-year period, will now offer 5,000 guarantees each year from 1 July 2022 to 30 June 2025.
- The new Regional Home Guarantee will offer 10,000 places each year from 1 October 2022 to 30 June 2025 to home buyers, including non-first home buyers and permanent residents, seeking to purchase or construct a new home in regional areas.
NHFIC:
An extra $2 billion has been allocated to the National Housing Finance and Investment Corporation (NHFIC) in this spending statement, as the government looks to improve availability of affordable housing.
Of this amount, around $1.64 billion is being dedicated to the National Housing and Homeless Agreement (NHHHA).
Another $223.8 million has been allocated to housing for Indigenous people in remote communities in 2022-23, while $3.8 million has been allocated to the Northern Territory Remote Aboriginal Investment over the coming financial year, in a bid to improve public housing and removing asbestos from community building in remote communities.
Fire and flood support:
The Federal Government expects to spend more than $6 billion on disaster relief and recovery following the recent floods in New South Wales and Queensland.
Income support, temporary accommodation and social services for households is expected to set the government back $2.2 billion.
A further $588.6 million will be allocated to community clean-up and recovery, including $300 million from the Emergency Response Fund for recovery and post-disaster resilience initiatives.
The Government also indicated it will provide an additional $116.4 million for the Black Summer Bushfire Recovery Grant program.
Insurance:
The Morrison Government has also re-iterated its spending for the cyclone and related flood damage reinsurance pool that’s set to come into effect from 1 July 2022, backed by a $10 billion government guarantee.
This pool aims to promote resilience in northern Australia, offering discounts for properties that have undertaken cyclone mitigation, while also collecting data to inform natural disaster planning.
Infrastructure:
The Budget has also included new commitments to road and rail projects: Brisbane to Sunshine Coast faster rail, Sydney to Newcastle faster rail, the METRONET project in Western Australia, the North-South Corridor in South Australia, the Great Eastern Drive in Tasmania, and Central Australian Tourism Roads in the Northern Territory, as well as a commitment to Melbourne’s Intermodal Terminals.
More than $500 million has also been allocated to local councils to deliver priority projects while $880 million will be targeted at better connecting regional Australia with ports, airports and other transport hubs.
Smart Property Investment will further unpack this Budget in coming days.