Outraged': How HomeBuilder has failed this rural Aussie couple

author-avatar By on June 05, 2020
Outraged': How HomeBuilder has failed this rural Aussie couple

Photo by Greyson Joralemon on Unsplash

One Australian couple have begged the Morrison Government to revise the terms of the HomeBuilder grant.

Announced late Wednesday, the $25,000 grant is available for new home builders building a home worth less than $750,000 (including land) and renovators who are spending between $150,000 and $750,000 on a house valued at less than $1.5 million. 

You must be an Australian citizen to be eligible, and earn less than $125,000 as a single and less than $200,000 as a couple. More details on the scheme can be found here

Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner occupiers.

Lender
Advertised rate Comparison rate Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval
VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
FixedMore details
NO UPFRONT OR ONGOING FEES

Basic Home Loan Fixed (Principal and Interest) (LVR < 70%) 3 Years

NO UPFRONT OR ONGOING FEES

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. Rates correct as of September 28, 2021. View disclaimer.

Peter Knobloch told Savings.com.au that he and his wife weren't eligible for the grant due to land value being included in the value of a new home build. 

The 63 year old was forced to evacuate his home in December due to the horrific bushfires that ravaged rural New South Wales, and said while his home hadn't been destroyed like so many others, it had wiped out his income and caused mental health issues. 

"We were locked down a long time ago before Corona even hit the streets," Mr Knobloch said. 

"I have a landscape photography business and I put my prints on canvas and sell them to local tourists.

"Of course, there's been no tourists, so we've had no income for six months." 

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Picture: Mr Knobloch and his granddaughter 

Mr Knobloch said he and his wife had bought a block of land for $350,000, closer to the coast to escape bushfires and planned to build a modest $500,000 home on the block. 

As the total cost exceeds $750,000, Mr Knobloch doesn't qualify for the HomeBuilder grant, and said he was absolutely outraged. 

"We qualify on every other front, we've had no money coming in from the Government, not even the $750 grant," he said.

"We've had no Jobkeeper, nothing from the Government. 

"And now our opportunity to at least receive $25,000 which would go a long way to helping pay for the $500,000 for the house, has been snapped away because of four little words: This includes land value." 

Mr Knobloch said he and his wife had to draw from their retirement savings to pay for the land, and didn't understand how someone completing exorbitant renovations to a home they already owned would receive the grant. 

"How can somebody that has a $1.5 million home be able to do a renovation for up to $750,000, and yet you're trying to build a modest home under the circumstances we find ourselves in and not qualify.

"It's this disparity which is disappointing, what do we have to do to qualify for something?

"It's not stimulating the economy." 

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Picture: The land Mr Knobloch and his wife bought for $350,000

Mr Knobloch said the Prime Minister was prioritising metropolitan areas over rural ones, and his community had received almost no support. 

"In his statement he says, we're really all about helping people in rural areas. Well I'm here to tell you, no you're not mate.

"There's been a complete lack of support for the people here that have been affected by fire in this community.

"We don't all live in a capital city." 

Mr Knobloch said after being ravaged by fires and the pandemic, the mental health of the people in his community was severley deteriorating.

"There's going to be many, many people in our position so we need to speak up," he said.

"You worry about mental health issues from the COVID lock-up, I can tell you there's more mental health issues here on the far south coast than you could poke a stick at, after what we've gone through in the last seven, eight months." 

HomeBuilder grant draws massive criticism

Mr Knobloch isn't alone in his criticism of the grant.

The Australian Council of Social Service (ACOSS) has also criticised the scheme, saying the plan is a wasted opportunity.

"There is no argument that the construction sector needs a shot in the arm, but this money will not go where it is most needed," ACOSS chief executive Dr Cassandra Goldie said.

"It will largely benefit those on middle and higher incomes undertaking costly renovations, without any related social or environmental benefits."

Read: How the experts reacted to HomeBuilder

Labor's housing spokesman Jason Clare said the scheme wasn't going to those people who really needed it.

"This package is one tenth of the size of what the Rudd government rolled out in the GFC and it's arguable that the economy and the construction sector is in a far worse situation now than then," Mr Clare said. 


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

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Alex joined Savings.com.au as a finance journalist in 2019. He enjoys covering in-depth economical releases and breaking down how they might affect the everyday punter. He is passionate about providing Australians with the information and tools needed to make them financially stable for their futures.

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