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Extended HomeBuilder good news for builders and timber merchants

The weekend announcement that the HomeBuilder commencement time will be extended to 18 months has been greeted as welcome news for the housing industry, the economy and for those embracing the HomeBuilder grant. There had been fears that many who applied for the $25,000 HomeBuilder grant would not be able to start work within the six-month construction deadline and would forfeit the grant. Source: Timberbiz

The HomeBuilder scheme closed for applications on April 14, and under its rules, work had to begin on a project within six months of contracts being signed.

Latest ABS data shows that house commencements surged by 27.0 per cent in the final quarter of 2020 to their highest level since March 2000.

The Australian Forest Products Association in March appealed to the Federal Government to extend the commencement timeframe to ease demand and allow time for stock to be produced and delivered.

“By making this sensible, practical change the Government has ensured that the HomeBuilder stimulus can continue to contribute to Australia’s economic recovery from the COVID pandemic,” AFPA CEO Ross Hampton said.

“The domestic industry supplies around 80 per cent of timber used in Australian home construction and ramped up production to keep pace with record the demand, spurred in part by HomeBuilder.

“Extending the timeframe for new builds will take the pressure off and allow more time for stock to be produced and delivered to builders.

“During the COVID-19 pandemic’s onset in 2020, HomeBuilder was a welcome stimulus during uncertain times, and while the boom it has in part fuelled certainly is welcomed by our forest industries, it highlights the significant supply constraints of Australian timber,” Mr Hampton said.

“We don’t have enough trees in the ground right now to meet future demand and the Federal Government urgently needs to do more to incentivise new plantings. That includes removing Carbon Farming Initiative (CFI) water rule barriers so forest growers and farmers can access payments under the Emissions Reduction Fund (ERF) in all Regional Forestry Hubs.’’

HIA Managing Director Graham Wolfe said that uptake of HomeBuilder had created a lifeline of work for tradies and helped support tens of thousands of first home buyers to achieve their dream of owning a home.

“Yet members have been severely impacted by global supply constraints and labour pressures. Builders and their clients have also been juggling delays in finance approvals, planning and building approvals and land title,” he said.

“HIA has been working closely with the Government since Christmas providing on the ground data and up to date information on home sales, building activity and supply chain issues impacting the industry’s capacity to deliver on the enormous success of the HomeBuilder program.

“The good work that HomeBuilder has done to stimulate the economy and retain jobs will be fully realised. Builders can now continue progressing the contracts they have in an orderly way.

“HomeBuilder had an immediate impact from the day it was announced. It has injected confidence in the housing industry – for builders, trade contractors, manufacturers, suppliers and into the retail sector – at a time when hundreds of thousands of jobs were at risk.

“That confidence supported, saved and retained existing jobs and created new jobs across the housing industry throughout Australia.

“Workers in jobs that were disappearing early last year were reinstated as the pipeline of work from sales, design and client engagement through to construction expanded. The HomeBuilder program will support these jobs into 2022 and beyond. Hundreds of thousands of workers,” Mr Wolfe said.