FIRST HOME OWNER GRANT (HOUSING GRANT REFORMS) AMENDMENT BILL

Second Reading

Second reading.

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (17:37): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation and explanation of clauses inserted in Hansard without my reading them.

Leave granted.

This Bill introduces legislative amendments required to implement changes to housing assistance grants to provide an urgent boost to the State's housing construction industry and help stimulate the property sector and secure jobs. The Bill also introduces legislative amendments required to implement changes to the first home bonus grant announced in the 2012-13 Budget.

The property market is soft and the housing construction is doing it tough. The Government recognises that it needs to put in place targeted measures to give confidence to the industry and get more South Australians buying or building a new home. The grants for purchases of new homes provided for in this Bill, together with the off-the-plan stamp duty concession scheme, demonstrate the Government's strong commitment to the housing construction industry. There has never been a better time for South Australians to build a new home or buy an off-the-plan apartment.

The Bill renames the First Home Owner Grant Act 2000 to be the First Home and Housing Construction Grants Act 2000.

This Bill amends the First Home Owner Grant Act 2000 to increase the First Home Owner Grant for new homes from $7,000 to $15,000 for contracts entered into on or after 15 October 2012. It also reduces the First Home Owner Grant for established homes from $7,000 to $5,000 for contracts entered into from the date the legislation comes into force until 30 June 2014. The First Home Owner Grant will be abolished for established homes from 1 July 2014. A new home is a home that has not been previously occupied or sold as a place of residence and includes a substantially renovated home.

The Bill removes the phase out of the first home bonus grant from $8,000 to $4,000 from 1 July 2012 as announced by the Government in the 2012-13 Budget. The first home bonus grant will remain at $8,000 for eligible transactions entered into between 1 July 2012 and 14 October 2012 (inclusive).

From 15 October 2012, the $8,000 first home bonus grant will be abolished and replaced with a Housing Construction Grant of $8500. The Housing Construction Grant will be available for all new home contracts entered into between 15 October 2012 and 30 June 2013 (or where building commences during that time for an owner builder) and where the property has a value up to $400,000. The Housing Construction Grant phases out for properties valued up to $450,000.

The Housing Construction Grant will be available to natural persons, companies and trusts and only one Housing Construction Grant will be paid per property.

The Bill includes transitional provisions to ensure the grants can be administered appropriately from the date of the Government's announcement of the revised grant arrangements.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

This clause is formal.

2—Commencement

The measure will be taken to have come into operation on 1 July 2012. This is the date on which ex gratia payments commenced in connection with the continuation of the first home bonus grant under section 18BA of the Act beyond 30 June 2012.

3—Amendment provisions

This clause is formal.

Part 2—Amendment of First Home Owner Grant Act 2000

4—Amendment of long title

It is necessary to amend the long title of the Act on account of the introduction of housing construction grants under this measure.

5—Amendment of section 1—Short title

It is necessary to revise the short title of the Act on account of the introduction of housing construction grants under this measure.

6—Amendment of section 3—Definitions

These amendments relate to new definitions that are required on account of the introduction of housing construction grants under this measure.

7—Amendment of section 5—Ownership of land and homes

Certain adjustments are required in connection with the concept of 'relevant interest' under the Act on account of the introduction of housing construction grants under this measure. It will be possible for a person to have an interest in land that is held subject to a trust but an equitable interest in land will not give rise to an entitlement to a grant in any circumstances.

8—Substitution of heading to Part 2

This is a consequential amendment.

9—Amendment of section 7—Entitlement to grants

A housing construction grant will be payable under new section 18BAB. It will be made clear that only 1 housing construction grant may be paid in relation to any particular new home.

10—Amendment of section 10—Criterion 3—Applicant (or applicant's spouse etc) must not have received earlier grant

11—Amendment of section 11—Criterion 4—Applicant (or applicant's spouse etc) must not have had relevant interest in residential property

12—Amendment of section 14—Application for grant

13—Amendment of section 17—Commissioner to decide applications

These amendments are all consequential on the introduction of housing construction grants under this measure.

14—Amendment of section 18—Amount of first home owner grant

The basic first home owner grant in relation to a new home transaction is to be increased to $15,000 from 15 October 2012. For other eligible transactions, the grant is to be reduced to $5,000 per transaction from the date on which this measure is enacted. No first home owner grant will be payable on or after 1 July 2014 in relation to a contract unless the contract is a new home transaction.

15—Amendment of section 18BA—Bonus grant for transactions on or after 17 September 2010 but before 15 October 2012

The first home bonus grant under this section is to be extended to 15 October 2012.

16—Substitution of section 18BAB

A new housing construction grant is to be introduced. The grant will be payable in relation to new home transactions that occur on or after 15 October 2012 but before 1 July 2013. The market value of the home must be less than $450,000. Various requirements as to completion of the relevant transaction will apply. The full grant of $8,500 will apply in relation to homes with a market value not exceeding $400,000 and the grant will phase out at $450,000. The Commissioner will be able to determine not to pay the grant if satisfied that a contract for the purchase of a new home is not a genuine sale or that the relevant contract has been substituted for an earlier contract entered into before 15 October 2012.

17—Substitution of section 18C

18—Amendment of section 31—Administration

19—Amendment of section 32—Delegation

20—Amendment of section 41—Protection of confidential information

These are consequential amendments.

Schedule 1—Transitional provisions

This schedule sets out transitional amendments associated with the commencement of this measure.

Debate adjourned on motion of Hon. J.M.A. Lensink.