CORONAVIRUS —
BUILDING BONUS PROGRAM
856. Ms L.L. BAKER to the Treasurer:
I refer to the McGowan Labor
government's commitment to driving Western Australia's economic
recovery from COVID and ensuring that the
state remains safe and strong. Can the Treasurer update the house on the
government's decision to extend the construction period for the
building bonus program and also tell us how the building bonus is driving more
activity in our building construction industry and supporting jobs and
business?
Mr B.S.
WYATT replied:
I had a go at this yesterday and I will
have another one today! It is such a successful policy that I want to ensure
that the people of this house know about the success it is having. As people
are aware, the government announced a building bonus policy to try to create
activity in the residential construction space. As we found out when we were
entering into the restrictions to fight the coronavirus, bearing in mind
population growth is expected to be very low over the next couple of years, the
pipeline of work was very small. We wanted to ensure that tradies—tens
of thousands of Western Australians—had a sure pipeline of activity.
Therefore, we implemented the
building bonus program. It is a $20 000 grant for really anyone building a home.
We did not cap it by value or say it had to
be owner occupied. We are allowing investors to take advantage of this particular
grant as well. The commonwealth complemented the grant with its $25 000
HomeBuilder grant, which is much more limited. Both programs have had success.
The number of applications so far for the building bonus is 1 256. As a result,
we are seeing a very strong increase in activity. Building approvals continue
to lift in Western Australia—in fact, not just lift, but surge. The
Minister for Housing will be familiar with this. It was up 43 per cent in
September and up 74 per cent relative to September last year. This is the
strongest outcome in the entire country.
As
a result, we now have a very strong pipeline of activity. Even earlier than
that, with the housing finance commitments, the number of loans taken
out by owner–occupiers increased by 26 per cent, underpinned by a 41
per cent increase in loans for construction. Of course, we are seeing this flow
on to not just the new builds, but also the established market is undergoing an
incredible increase in activity, and transaction data is the strongest it has
been in nearly a decade. We are seeing the property market come in very
strongly and, as a result, CoreLogic is now expecting an increase in the value
of homes in Western Australia.
We have had to tweak the policy a couple
of times to ensure that we smooth the pipeline of activity. As I discussed
yesterday, the most recent decision was to allow a longer period to commence
construction through to the end of the 2021 calendar year, which means that we
expect this pipeline of activity to continue well into 2022. Of course, as we
all know, hopefully by then we will have managed to secure a more normal
environment of migration and movement around the globe. There is no doubt, in
terms of a stimulus program, that the building bonus has been the most successful in the country. It is
delivering exactly what we wanted it to do—that is, create a pipeline
of jobs for Western Australians. All up, the McGowan Labor government
has put around $1.6 billion or $1.7 billion into the property sector by way of
supports, tax rebates et cetera over the last three budgets. It is delivering
in spades for Western Australia. We are very proud of the policy.