An unprecedented level of demand for available land and new home builds,has been felt since the government HomeBuilder announcement made on June 4th.This increase in activity has been reportedly felt across the country but has been particularly strong in regional areas such as Ballarat where eligible first-home buyers can also take advantage of the current $20,000 first-home buyer grant.
Keeping up with the demand has been a challenge for the industry, with some interested buyers struggling to find available land that titles within the time frame stipulated in the grant conditions.
The HomeBuilder grant, announced June 4, gives eligible home owners and first-home buyers cash grants of $25,000 to build new homes up to the value of $750,000 or to assist with renovations of between $150,000 and $750,000, applying to contracts entered between June 4 and December 31 this year.
Boutique Homes, New Homes Consultant James Belsar said the activity following the announcement of the grant resulted in a huge spike of demand for new home builds.
“This has resulted in huge demand in new home builds on titled blocks. As an organisation we wanted to ensure the amount of volume we took in was sustainable.We are incredibly protective of our customer experience and wanted to ensure the added volume of builds wasn’t going to impact our clients.”
In May prior to the governments Home Builder grant announcement on June 4, Australia’s focus on property was high with record levels of enquiry throughout the industry.
realestate.com.au has recorded historically elevated levels of high intent activity over the past weeks with many regions experiencing more then a doubling in serious buyer activity.
According to the most recent REA Weekly Demand Insights, not only are large search volumes being recorded but activity from serious buyers continues to grow. (https://www.realestate.com.au/insights/rea-insights-weekly-demand-report-4/)
GJ Gardner Homes sales support officer Jordan Keast said they have recorded almost double the amount of enquiry in July from May and triple that of March and April.
“A large percentage of the enquiry has come from first home buyers who will look to make use of the FHB grant and the $25k federal government stimulus package on offer. We have also seen some previous prospective clients who have been sitting back waiting/planning or saving more funds, re engage with our sales team to take advantage of the grant”, Keast said.
“We found in the first weekend that the majority of titled or near titled land was sold or put on hold which has created even more urgency around the grant and being able to find and secure land, the number one challenge for prospective buyers.
“The introduction of the grant has been fantastic as all of our local tradespeople can be confident in continued ongoing work with our upcoming builds. During the Covid lockdowns our directors Rob McMaster and Wayne Jones felt it was important to keep our trades and suppliers informed and engaged and spoke to them all directly to let them know we had a good supply of work coming up to give them and their family’s peace of mind.
“This new grant has only further strengthened this, which has created a lot of positivity and energy in our sector. Based on what we have seen, I would say that it's going to be very busy in the coming months for Ballarat builders and builders everywhere which will help stimulate the economy and provide employment for many Victorians”, Keast said.
Many countries around the world are looking to the construction industry to help rebuild economies. Construction is one of Australia’s largest employers. The sector employs about 1.2 million people directly,and indirectly many more. It’s one of the largest employers of apprentices, youth and disadvantaged groups such as Indigenous people and refugees.
Investment in construction flows through the broader economy.The Australian Bureau of Statistics estimates every A$1 million spent on construction output generates A$2.9 million in output across the economy as a whole. Every job created in construction leads to another three inthe wider economy.
Integras Director of Land Nick Grylewicz said with the construction industry being one of Australia’s largest employers, the construction and infrastructure programs provide a powerful stimulus tool.
looking to this sector to drive recovery. Regional areas could really be the major benefactors of the program. The $25,000 HomeBuilder grant has boosted more new home sales in Ballarat where eligible first-home buyers can also take advantage of the current $20,000 first-home buyer grant, bringing the total incentive to $45,000. Add in stamp duty savings, low interest rates and builders offering great promotions it is a unique time to be a buyer in this industry.
“The HomeBuilder program will help stimulate confidence as well as save jobs in the residential construction sector and we are already seeing the effects of this. The grant has been a real facilitator for a recent surge in enquiry. Hopefully anyone who has missed out on fitting the requirements for this particular stimulus will still find some support in further assistance from the government in future announcements”, Grylewicz said.
Ballarat has also recently faired well in the Price Predictor survey leading the regional Victorian house price boom. (https://www.propertyobserver.com.au/terry-ryder/114100-ballarat-leads-the-regional-victorian-house-price-boom-hotspotting-s-terry-ryder.html)
Regional areas of Victoria have been boosted by buyers out of Melbourne, including home buyers seeking a more relaxed and affordable lifestyle, while in some cases working remotely for city business. The coronavirus shutdown period which forced people to work from home is thought to further enhance this trend.
The Winter price predictor survey of sales activity reveals that Regional Victoria has remained quite resilient in terms of sales activity, in the faces of the Covid-19 impacts. There has been only a minor reduction in the number of locations with growing sales activity, compared to the results of the Autumn survey. This is shown by the many individual suburbs and towns throughout Regional Victoria which have recorded median price growth above 10% in the past 12 months.
Ballarat has recorded the highest growth, led by the suburbs of Ballarat Central (up 24%) and Lake Wendouree(23%). Brown Hill, Redan, Alfredton and Sebastopol have all increased between 10% and 12%. Other Ballarat suburbs have increased 7-8%.
Amongst other Ballarat news is this weeks Polis Partners’ City Report naming Ballarat as the number one city in Australia for economic growth. As well as an earlier report by RMIT HealthyLiveable Cities Group naming Ballarat Australia’s most liveable regional city and the Big Movers Report listing Ballarat as one of a number of popular destinations for millennials making tree changes to regional settings.