With the already record low official cash rate of 0.25%pa, the Reserve Bank of Australia has once again decided to hold interest rates where they are, with no end in site of the COVID-19 economic downturn, it is predicted that this rate will remain for some time.
The RBA stated that “The Bank’s mid-March package of support for the Australian economy is working as expected. There is a very high level of liquidity in the Australian financial system and borrowing rates are at historical lows. Authorised deposit-taking institutions are continuing to draw on the Term Funding Facility, with total drawings to date of around $29 billion. Further use of this facility is expected over coming months.”
Incentives to Build?
The Federal Government’s HomeBuilder Grant is now underway, with most states have issued guidance as to how the scheme will be managed and how to apply.
If you are considering build a new home, now could be the time to take the plunge, but first you need to ensure you meet the eligibility criteria:
To access HomeBuilder, owner-occupiers must meet the following eligibility criteria:
- you are a natural person (not a company or trust);
- you are aged 18 years or older;
- you are an Australian citizen;
- you meet one of the following two income caps: $125,000 per annum for an individual applicant based on your 2019-20 taxable income; or $200,000 per annum for a couple based on your 201-20 taxable income.
- you enter into a building contract between 4 June 2020 and 31 December 2020 to either:
- build a new home as a principal place of residence, where the property value does not exceed $750,000; or
- substantially renovate your existing home as a principal place of residence, where the renovation contract is between $150,000 and $750,000, and where the value of your existing property (house and land) does not exceed $1.5 million (pre-renovation);
- construction must commence on or after 4 June and within three months of the contract date.
If you have any questions regarding the HomeBuilder Grant, please feel free to contact us.