Federal Budget ignores pressing housing issues, says HIA
By Peter Sarmas on 15 May 2013
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The Housing Industry Association (HIA) released a scathing review of last night’s 2013 Federal Budget in which it said the Federal Government largely ignored Australia’s residential building industry and missed an opportunity to implement further measures to increase housing supply.
“Housing Australians should be a Federal Government priority,” said HIA Chief Economist, Dr Harley Dale. “While the budget retains the existing NRAS program and includes a modest measure to assist seniors in downsizing their homes, housing has otherwise been ignored.”
Mr Dale expressed dissatisfaction at the lack of measures addressing the excessive red tape and taxes plaguing the residential building industry, saying that “Such reform and investment measures would generate a healthy economic dividend to the entire economy, including a substantial boost to government revenue.” Furthermore, Mr Dale said the 2013 Budget failed “to address necessary infrastructure funding to support new residential development and boost new housing supply.”
“For an industry that is crucial to rebalancing Australia’s economic growth, a lack of focus on residential building in tonight’s budget is a glaring omission,” Mr Dale concluded.
Likewise, investors, buyers and home owners anticipating changes to capital gains tax, negative gearing or the first home owner’s grants were also left disappointed with the Federal Government choosing to maintain the status quo with no new reforms.
However, it was not all bad news for the housing market. One of the positives to emerge from the 2013 Federal Budget was the $112 million pilot designed to encourage seniors to downsize from their family home. From 1 July 2014, senior Australian homeowners who have owned their family home for at least 25 years and who decide to downsize will have the option to quarantine, up to ten years, the sale proceeds from their home (up to $200,000) from the Centrelink means test for the age pension. Federal Treasurer Wayne Swan said the new measure will “assist senior Australians to downsize to a home more suitable to their needs without reducing their age pension.”
The scheme is expected to support asset rich but cash poor baby boomers, as well as free up a portion of the residential housing market for the next generation of younger buyers looking to upgrade from high density housing.
