Federal Budget 2022: Inside Labor’s plan to build 1 million new affordable homes
![Treasurer Jim Chalmers and Finance Minister Katy Gallagher arriving at the press gallery at Parliament House on October 25, 2022 in Canberra, Australia.](https://cdn.mozo.com.au/images/atwood/14260/federal-budget-2022-housing-accord.png)
At a time when rent prices are boiling over and homebuyers are being priced out of the areas they work in, Labor’s Federal Budget for 2022-23 provides a modicum of hope for the future of affordable housing.
The government’s goal of delivering one million well-located, energy-efficient and affordable homes is slated to take five years to come to fruition, with the first act delayed until mid-2024 as a booster-shot for when the construction sector is expected to dry up.
If it sounds a little high-reaching to you, you’re not alone.
The government itself admitted they’ve drawn a “big, ambitious target”, with treasurer Jim Chalmers labelling it an aspiration. But they aren’t tackling the housing problem alone.
Let’s take a closer look following the release of the 2022 Federal Budget.
"Supply hasn’t kept up with demand, which means too many struggle to live close to where they work, too many are stuck on waiting lists for social housing, and for too many, the great Australian dream of homeownership seems completely out of reach."
Confronting the housing problem with the private sector
In his speech to parliament, Jim Chalmers spoke of a budget that “does more to confront Australia’s housing problem,” not just for those wishing to get a foot on the property ladder, but for renters and those in need of social housing.
“Supply hasn’t kept up with demand, which means too many struggle to live close to where they work, too many are stuck on waiting lists for social housing, and for too many, the great Australian dream of homeownership seems completely out of reach,” he said.
The ‘Australian dream’, according to the government, will be realised with the help of state and territory governments, investors, and industry. In particular, the government will be relying on superannuation funds that have long been “hungry” for stable, long-term investments.
The Housing Accord aims to address the issue of lacklustre institutional housing investment in Australia.
“Australia is facing acute housing pressures and too many Australians do not have access to affordable housing,” the budget documents read.
“At the same time Australia has a low level of institutional housing investment and the world’s third largest pool of capital in our superannuation system which is hungry for investments that will deliver stable returns over the long term.”
The government suggests that with ongoing funding it can cover the gap between market rents and subsidised rents to make more projects commercially viable for investors.
A “kickstart” to construction with up to 20,000 new homes
But the onus won’t just be on the private-sector, with Chalmers saying the government intends “to play a leading role by coordinating and kickstarting the investment that we know needs to happen.
“To get the Accord started, this budget commits an additional $350 million in funding for another 10,000 new, affordable homes on top of our existing commitments,” he said.
State and territory governments also have a part to play in the Housing Accord, signing-up to build up to 10,000 additional new homes out of their own coffers, bringing the total to 20,000.
“Under the Accord, state and territory governments will undertake expedited zoning, planning and land release to deliver on a joint commitment to improve the availability of social and affordable housing in well-located areas, including looking for immediate opportunities to free up well-located state land,” budget documents read.
The government’s Housing Accord is all about ensuring “an adequate supply of affordable housing where it is needed – close to jobs, transport, and other services,” Chalmers said.
Before the May election, Labor ran on a promise to build 30,000 new social and affordable homes as part of the $10 billion Housing Australia Future Fund, which it says has not been forgotten.
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6.34
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6.14
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$134
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- Initial monthly repayment
-
$3,027
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6.09
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-
6.11
%
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-
$250
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$0.00
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6.09
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-
6.13
%
p.a.
- Initial monthly repayment
-
$3,027
Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.
- Interest rate
-
6.09
%
p.a.
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- Comparison rate
-
6.13
%
p.a.
- Upfront fees
-
$595
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Basic Home Loan
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-
6.14
%
p.a.
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- Comparison rate
-
6.16
%
p.a.
- Initial monthly repayment
-
$3,043
Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.
- Interest rate
-
6.14
%
p.a.
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- Comparison rate
-
6.16
%
p.a.
- Upfront fees
-
$350
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$0.00
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$400.00
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yes - free
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Flex Home Loan
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-
6.14
%
p.a.
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-
6.38
%
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-
$3,043
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6.14
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6.38
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-
$250
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$250.00 yearly
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$300.00
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yes - free
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Offset Home Loan
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-
6.14
%
p.a.
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-
6.39
%
p.a.
- Initial monthly repayment
-
$3,043
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- Interest rate
-
6.14
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- Comparison rate
-
6.39
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- Upfront fees
-
$350
- Ongoing fees
-
$248.00 yearly
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-
$400.00
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yes - free
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Basic Home Loan
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- Interest rate
-
6.25
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p.a.
Fixed 3 years
- Comparison rate
-
6.20
%
p.a.
- Initial monthly repayment
-
$3,079
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- Interest rate
-
6.25
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p.a.
Fixed 3 years
- Comparison rate
-
6.20
%
p.a.
- Upfront fees
-
$350
- Ongoing fees
-
$0.00
- Discharge fee
-
$400.00
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-
yes - up to $10,000 p.a.
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yes - free
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no
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Offset Home Loan
- Fixed
- Owner Occupier
- Principal & Interest
- LVR <70%
- Interest rate
-
6.25
%
p.a.
Fixed 3 years
- Comparison rate
-
6.42
%
p.a.
- Initial monthly repayment
-
$3,079
- Interest rate
-
6.25
%
p.a.
Fixed 3 years
- Comparison rate
-
6.42
%
p.a.
- Upfront fees
-
$350
- Ongoing fees
-
$248.00 yearly
- Discharge fee
-
$400.00
- Extra repayments
-
yes - up to $10,000 p.a.
- Redraw facility
-
yes - free
- Offset account
-
yes
- Maximum loan to value ratio
- 70.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- $10,000,000
- Type of mortgage
- Fixed
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- Principal & Interest
- Availability
- Owner Occupier
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- Monthly
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Fixed Rate
- Owner Occupier
- Principal & Interest
- <80% LVR
- Interest rate
-
6.54
%
p.a.
Fixed 2 years
- Comparison rate
-
7.10
%
p.a.
- Initial monthly repayment
-
$3,174
Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.
- Interest rate
-
6.54
%
p.a.
Fixed 2 years
- Comparison rate
-
7.10
%
p.a.
- Upfront fees
-
$160
- Ongoing fees
-
$0.00
- Discharge fee
-
$160.00
- Extra repayments
-
yes - free up to to lesser of 5% of original fixed loan amount, or $5,000 each year
- Redraw facility
-
no
- Offset account
-
Optional - $10 per month - 1 year fixed term only
- Maximum loan to value ratio
- 80.00%
- Minimum borrowing amount
- $20,000
- Maximum borrowing amount
- -
- Type of mortgage
- Fixed
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- $3,000 cashback for eligible First Home Buyers, $2,000 cashback when you refinance loans of $250k+, apply from 1 Dec 2022, settle within 180 days.
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