$21.4 Million Stimulus To Boost Construction & Affordable Housing
Like most of us, the construction and housing industry took a major hit this year with the effects of COVID-19 presenting significant challenges and obstacles for both businesses and homebuyers alike. Although the pace of decline has slowed in recent months, the key industry index hit its lowest rate since 2005. Representing 13% of the global GDP, how can this once thriving industry recover economically with sites shutting down, delayed supply chains and a sudden surge in unemployment? An impressive Government stimulus could play a key role in the emergence of a stronger construction industry.
As we begin to move forward into the ‘new normal’ here in South Australia, the Marshall Liberal Government are investing $21.4 million in housing stimulus. Not only providing a pipeline of work for South Australian Construction businesses and trades, but also creating more affordable housing options for first home buyers and low-to-moderate income earners. The stimulus is anticipated to combat a somewhat dire prediction of new builds plummeting 50% compared to 2018 rates.
The recently announced South Australian Housing Authority 100 Homes Program has begun construction, with slabs being poured and houses popping up in suburbs all over Adelaide such as Devon Park, Klemzig, Taperoo, Mt Barker, Findon, South Plympton, and Edwardstown. A promising showcase of resilience in these uncertain times, the program is expected to be completed by early-to-mid 2021, in the meantime providing an economical boost to support the industry, and the South Australians working within it.
Additionally, 70 of the 100 Homes will be sold as affordable. According to the South Australian Government, affordable housing by definition is priced between $365,000 and $419,750 and is designed to cost no more than 30% of the buyer’s gross income in repayments. The Australian Bureau of Statistics Living Cost Index (2018) revealed that post-tax incomes would be required to increase by up to 2.5% in order to keep up with the rising costs. Therefore this stimulus presents a fantastic opportunity for low-to-moderate-income earners or first home buyers to enter the market, despite battling the constantly rising costs of living in Australia outpacing salaries.
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