What the 2022-2023 Federal budget means for off-the-plan property

The 2022-2023 Federal budget includes a new National Housing Accord.

Dr Jim Chalmers has stated that this initiative is “a landmark agreement to address one of our nation’s biggest economic challenges: the supply and affordability of housing”.

The Federal budget for the 2022-2023 financial year was delivered yesterday, October 25 2022. As the first budget handed down by the Treasurer, Dr Jim Chalmers, since Labor formed government, it delivered minimal surprises.

The off-the-plan property industry is likely to see benefits from the budget in the coming years, with the National Housing Accord featuring as a standout measure of the budget. 

Positives 

The introduction of the National Housing Accord promises to “align for the first time the efforts of all levels of government, institutional investors and the construction sector to help tackle the nation’s housing problem”. 

The budget includes $350 million in additional Federal funding to deliver 10,000 affordable homes over five years from 2024. This is in addition to the Albanese Government’s existing election commitments. 

State and territory governments have also agreed to build on this by offering up to 10,00 new homes. 

This means that, in total, up to 20,000 new affordable dwellings will be built. 

There are several immediate actions to be implemented regarding housing and construction included in the budget as well. These include the expediting of zoning, planning, and land release for social and affordable housing by states and territories, the Commonwealth providing financing options for institutional investment in social and affordable housing through the Housing Australia Future Fund, and collaboration with local governments to deliver planning reforms and to free up landholdings. 

All of these measures are likely to positively impact the off-the-plan property sector and the supply of affordable newly built, off-the-plan developments for buyers. 

Negatives

A drawback of the 2022 Federal budget is that the delivery of additional housing will not begin until 2024 and will be completed over the course of five years. 

Whilst much of the projected housing supply will need to come from the market rather than the government itself, Dr Chalmers has stated that “This funding will incentivise superannuation funds and other institutional investors to make investments in social and affordable housing by covering the gap between market rents and subsidised rents”. 

“The Albanese Government’s ambitious housing reform agenda aims to support more people into home ownership and improve the supply and quality of social and affordable housing,” Dr Chalmers said. 

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