The $25,000 HomeBuilder Grant explained…

Last month the federal government revealed the details of its fourth economic stimulus package, to be worth a total of $680 million.

Called the HomeBuilder program, it is a time-limited grant program designed to help the residential construction market bounce back from the Coronavirus crisis.

How it works

HomeBuilder will provide eligible owner-occupiers [including first home buyers] with a grant of $25,000 to build a new home or substantially renovate an existing home where the contract is signed between 4 June 2020 and 31 December 2020. Construction must commence within three months of the contract date.

HomeBuilder will complement existing State and Territory First Home Owner Grant programs, stamp duty concessions and other grant schemes, as well as the Commonwealth’s First Home Loan Deposit Scheme and First Home Super Saver Scheme.


To access HomeBuilder, owner-occupiers must meet the following eligibility criteria:

  • you are a natural person [not a company or trust];
  • you are aged 18 years or older;
  • you are an Australian citizen;
  • you meet one of the following two income caps: $125,000 per annum for an individual applicant based on your 2018-19 taxable income or later; or $200,000 per annum for a couple based on both 2018-19 taxable income or later.
  • you enter into a building contract between 4 June 2020 and 31 December 2020 to either:
    build a new home as a principal place of residence, where the property value does not exceed $750,000;
    or substantially renovate your existing home as a principal place of residence, where the renovation contract is between $150,000 and $750,000, and where the value of your existing property [house and land] does not exceed $1.5 million [pre-renovation];
  • construction must commence on or after 4 June and within three months of the contract date.


Other Considerations

Investment properties are ineligible for HomeBuilder.

Owner-builders are ineligible for HomeBuilder.

In negotiating a building contact, the parties must deal with each other at arm’s length. This means the contract must be made by two parties freely and independently of each other, and without some special relationship, such as being a relative. The terms of the contract should be commercially reasonable and the contract price should not be inflated compared to the fair market price.

Renovations or building work must be undertaken by a registered or licenced building service ‘contractor’ and named as a builder on the building licence or permit.

The renovation works must be to improve the accessibility, safety or liveability of the dwelling. It cannot be for standalone granny flats, swimming pools, tennis courts, and structures that are not connected to the property i.e. outdoor spas and saunas, sheds or standalone garages.

HomeBuilder will be non-taxable – consistent with existing state and territory first home owner grant programs.


Process & Timing

HomeBuilder will be implemented via a national partnership agreement with State and Territory governments.

When the States and Territories begin accepting HomeBuilder applications, they will backdate acceptance of these applications to 4 June 2020.

Information on when and how you will be able to access HomeBuilder will become available soon.

For more info –

To get notification on how and when you will be able to apply for the HomeBuilder Grant, Register Here


Other Government Grants/Incentives

First Home Owners Grant [First Home Buyers only]

The $15,000 FHOG applies to the purchase or construction of a new residential property, including a house, flat, unit, townhouse or apartment that meets local planning standards anywhere in South Australia. [The FHOG ceased for established homes from 1 July 2014]

The residential property must be occupied as each applicants’ principal place of residence for a continuous period of at least six months commencing within 12 months of date of settlement for contracts to purchase, or the date construction is completed for owner builders or contracts to build.

For more info –

First Home Loan Deposit Scheme [First Home Buyers only]

The federal government launched the FHLDS as an initiative to assist people in entering the housing market for the first time by underwriting home loans for first home buyers. The new government scheme for first time buyers allows approved applicants to take out a mortgage with just a 5% deposit and avoid paying lenders mortgage insurance.

For more info –

First Home Super Saver Scheme [First Home Buyers only]

The FHSS Scheme allows home buyers to withdraw voluntary superannuation contributions they have made to their super fund, and to put this money towards a deposit on a property. So, if you have made voluntary super contributions [of up to $15,000 per financial year], you can withdraw that money to take advantage of the government’s 5% deposit offer. The limit you can withdraw is $30,000 for singles and $60,000 for couples.

For more info –


HomeBuilder Case Studies

First home buyers Emma and Liam decide to purchase a house & land package

Emma and Liam enter into a house & land contract for $550,000 on 25 September 2020. Emma and Liam’s bank applies on the couple’s behalf to the relevant State or Territory State or Territory to receive the HomeBuilder $25,000 grant. The State or Territory conducts the eligibility checks and reviews the couple’s documentation and confirms that both Emma and Liam are Australian citizens, over the age of 18, have a combined taxable income under $200,000 based on their 2018-19 tax return and the value of the contract is under the $750,000 contract price cap.

As the couple are both first home buyers, Emma and Liam may also be entitled to their State’s First Home Owner Grant and stamp duty concessions as well as the Commonwealth’s First Home Loan Deposit Scheme and First Home Super Saver Scheme.

Owner-occupier Cassidy decides to substantially renovate her home

Cassidy enters into a contract on 31 December 2020 to substantially renovate her home, with renovations valued at $400,000. The value of her home is $900,000 (this includes the value of the house and the land). Cassidy pays the builder $150,000 of the cost of renovation of her home on 2 February 2021. Cassidy then applies directly to her State or Territory to receive the $25,000 HomeBuilder grant.

The State or Territory conducts the eligibility checks and confirms that Cassidy owns the property, is an Australian citizen, over the age of 18, and has a taxable income under $125,000 based on her 2019-20 tax return. The State or Territory also confirms the value of the renovations is between $150,000 and $750,000, and the value of her home (house and land) is less than $1.5 million pre-renovation, and Cassidy has made a payment of at least $150,000 for the renovations. The State or Territory approves the application.

As Cassidy already owns her own home, she is not eligible for the First Home Owner Grant, the First Home Loan Deposit Scheme or the First Home Super Saver Scheme.


There’s probably never been a better time to buy or build a new home, especially if you are a first home buyer!

If you have any questions or simply don’t know where to start get in touch with us today on 08 8451 1500 – we’re here to help!


Sam, Matt & Andy
​Urbantech Finance

PS. COVID-19 Update – We’ve put together a simple resource to let you know of all the core lender changes and initiatives in response to COVID-19, along with a range of financial options and strategies for getting through this difficult time. To access this info click here

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