Have you been thinking about or even trying to buy your first home and just feel like it is absolutely impossible to get into the current market? Has the “Great Australian Dream” of owning your own home felt like an unattainable nightmare?- Well there might be a light at the end of that tunnel and a small glimmer of hope for First Home Buyers (FHB) out there in Tasmania!!!

The Tasmanian government is finding and taking unprecedented ways to assist the housing needs of Tasmanians through accelerating the current housing programs and initiating new schemes.

One of which is the revamped Housing Market Entry Program, which will help in assisting young home buyers to achieve the great Australian dream.

In this program, potential purchasers can have the opportunity to buy a home with as little as a 2% deposit and the government, as an equity contribution, shall cover up to $200,000 of the purchase price.

Premier Peter Gutwein has announced these major changes to current government schemes which will save buyers a lot and give a foot up to all the hard working youth trying to get into their own home. To put it in perspective, an eligible applicant who wishes to purchase a $500,000 home could successfully do so with a deposit as low as $10,000 and a mortgage worth $300,000.

Long story short, the Tasmanian government will partner up with people  to assist in  securing their first home, whether it is built or purchased.

“It’s a fantastic way of getting people to be able to take that first step on the property ladder,” Mr Gutwein said. “In effect, it’s like the Bank of Mum and Dad, almost providing people with an increased amount of funding to get into that first home,” he added.

This new scheme is an expansion of the existing Home Share Tasmania policy and is set to commence by 1st July 2022.

Affordability and supply are one of the major issues in the Tasmanian property market currently, hence, aside from the Housing Market Entry Program, a suite of other government reforms are also aimed at boosting both, which has been warmly welcomed by industry groups and the Tasmanian Council of Social Service Inc (TasCOSS).

Some changes to housing policy were announced by Mr Gutwein on Tuesday which includes the First Home Owners Grants, First Home Owner Stamp Duty Concession, and Ancillary Dwelling Grant Program.

The government has declared an increase in the threshold for all Stamp Duty and First Homeowner grants to  $600,000. Including the previous changes, this results in a 50% increase, in sync with rising property prices. In figures, the stamp duty savings that an eligible first home buyer or a pensioner purchasing a downsized on a $600,000 property will amount to more likely $11,250–which will be backdated to January 1.

Likewise, John McGregor, a Sales Agent at 4one4 Property Co., concurs with the idea of seeing stamp duty relief given to those at the end of their property cycle including the retirees. “They are often stuck in their homes due to being hit hard by the cost of stamp duty and selling fees which disincentivizes them from moving and prevents many larger homes from being freed up for growing families who, in turn, often sell their smaller more affordable home,” John explained.

“If we are to provide government assistance, opportunities that assist those at the beginning and the end of their property journey seem to me to be the best areas to focus on.”

As for the $30,000 First Home Owner Grant, it is now extended for another year to July 2023. The government has also doubled its popular cash for granny flats scheme–formally known as the Ancillary Dwellings program– from 250 to 500 dwellings for $2.5m. Additionally, land tax cuts worth $220m announced earlier in the week by the Premier will be in place starting July 1.

Moreover, there will be an extension of the Headworks Holiday program, doubling the Residential Land Rebate from $15 million to $30 million to further accelerate land supply.

“Bottom line, Tasmania’s 7-year strong economic run means it has [the] financial capacity to fund good initiatives plus the various state [government] policies have proven that they understand the true cause of housing supply,” Mr Pressley highlighted. “Tassie is showing leadership in the property space where other states are making things worse,” he continued.

“The Tasmanian government deserves [a] huge applause for introducing more effective housing policies than any other Australian state. Different packages provide support for new construction, for upgrading a home, incentives for the elderly to downsize, and encouragement for property investors to add more rental supply,” he added.

Similarly, Property Council of Australia Tasmania Executive Director Rebecca Ellston believes that these new policies will go a long way to substantially increase the supply of social and affordable housing which she describes as enduring and sustainable.

With these housing schemes, Simon Pressley, Founder and Managing Director of Propertyology, claims that the Tasmanian government manifests a fantastic leadership coming up with good initiatives for housing while other states struggle to present one. “Bottom line, Tasmania’s 7-year strong economic run means it has [the] financial capacity to fund good initiatives plus the various state [government] policies have proven that they understand the true cause of housing supply,” Mr Pressley highlighted. “Tassie is showing leadership in the property space where other states are making things worse,” he continued.

“The Tasmanian government deserves [a] huge applause for introducing more effective housing policies than any other Australian state. Different packages provide support for new construction, for upgrading a home, incentives for the elderly to downsize, and encouragement for property investors to add more rental supply,” he added.

Similarly, Property Council of Australia Tasmania Executive Director Rebecca Ellston believes that these new policies will go a long way to substantially increase the supply of social and affordable housing which she describes as enduring and sustainable.

“The Government’s introduction of this approach demonstrates a government looking at new ways to tackle a complex issue across Australia and is widely welcomed by [the] industry,” Ms Ellston said.

“Simplifying the rezoning process and the implementation of an Apartment Code are reforms that the Property Council has advocated for over many years and will help to create the right settings to boost supply.”

Based on current demand projections, TasCOSS CEO Ms Adrienne Picone said that we need to be building 1,000 new social homes every year for the next decade, thus, the government’s pledge of 10,000 new dwellings by 2032 was welcomed.

“To their credit, the Government has answered this call… Sufficient supply of safe, affordable housing will ensure Tasmania is rebuilt stronger post-COVID-19.”

 

Ms Ellston, however, sees sourcing the workforce and materials required to deliver the homes promptly as the main challenge here.

On Wednesday, Minister for State Development, Construction and Housing Michael Ferguson was at the Hobart Showgrounds to sign off a $42m redevelopment. He mentioned that the government is aiming to ease the housing affordability crisis, particularly for young buyers.

The strong growth in housing is being seen by Mr Ferguson as a reflection of the state’s buoyant economy. Since the state is growing, according to him, Tasmanians do need to see more housing available.

“Gone are the days where young people were fleeing the state and families needing to leave Tasmania to get jobs in other states,” he stressed.

As per the press release posted by the Premier just this start of the month, there are other initiatives that the government will be introducing to the Tasmanian home buyers.

These include (1) the resetting of the tax-free threshold to $100,000 and lifting the upper tax threshold to $500,000 while lowering the tax rate for land valued between $100,000 and $500,000 from 0.55 per cent to 0.45 per cent; (2) Encouraging development at the edges of the urban growth boundary by making rezoning applications easier; (3) Working with councils to achieve more “shop top” apartments; (4) Better utilising Government-owned buildings by repurposing them for a higher and better use; (5) Assessing the viability of build to rent schemes; (6) Providing safeguards for rent-to-buy schemes to encourage the uptake of them; (7) Introducing a new Apartment Code to simplify medium-density apartment and townhouse approvals; and (8) Committing to a review of the utilisation of our social housing portfolio, to gain more efficiencies.

While these boosted programs and new schemes are set to lessen the burden of home acquisition of our fellow Tasmanians–most especially the first home buyers, 4one4 Property Co. will still consistently adhere to its commitment to helping all types of people secure their respective homes right from the initial step down to the final process, while assisting them with the privileges that they can take advantage of along the way.