HomeBuilder Renovations: Where are QLD’s most qualifying owner-occupier dwellings?
The HomeBuilder grant announced in early June is intended to boost activity in the construction sector. Dwelling construction is expected to see a lagged decline in activity off the back of COVID-19, as the recently recovering trend in dwelling approvals began to slip in April, led by a decline in unit approvals.
However, the $25,000 incentive for building a new home, or renovating an established one, comes with a set of extensive eligibility criteria. Part of the eligibility for the renovation component of the scheme is that properties must be owner-occupied, and not exceed more than $1.5 million in value. So where are the most owner-occupied properties under $1.5 million in Queensland?
According to CoreLogic, the data suggests that the highest number of owner-occupied properties in Queensland is located on the Gold Coast, with 132,976 properties qualifying for the HomeBuilder grant, with a median value of $550,152 (with 93.3% of households earning under $200,000). The Gold Coast is ranked #4 in the Top Ten regions by count of owner-occupier properties worth less than $1.5 million and eligible for the grant.
Queensland’s outback regions as well as the Darling Downs – Maranoa region are the areas that would qualify the least for no other reason than simply a low population of dwellings. The Queensland outback has approximately 2.178 properties with a median value of $160,972 (with 93.1% of households earning under $200,000). And, for the Darling Downs – Maranoa region, total properties comes in at 11,681 with a median value of $235,869 (with 96.3% of households earning under $200,000).
Even where dwellings fall well below the $1.5 million threshold for a renovation grant, many of these owner occupiers will not take up the homebuilder incentive for renovations.
In fact, it’s estimated that there are about 4.4 million owner-occupied properties across Australia with a high confidence valuation below $1.5 million, but the Federal Government forecasts the scheme may only support about 7,000 renovations.
While part of this is the income cap put on the scheme, it’s also due to the high value of renovations that is set in the eligibility criteria. The renovations qualifying for the HomeBuilder grant must be worth between $150,000 – $750,000. For areas where dwelling prices and incomes are relatively low, this would ultimately lead to owners over-capitalising on renovations, where they cannot recoup the cost of upgrades to the property.