By Jamie Salter
Social crusader Tony Fitzgerald has welcomed the Labor Government’s bold new policy to tackle Australia’s housing crisis and make home ownership achievable for 10,000 Australians per year.
Announced by Anthony Albanese at the ALP’s campaign launch in Perth on Sunday, 1 May, Help to Buy will provide eligible homebuyers with 30 per cent of the cost of an existing home and 40 per cent of the cost of a new home – providing a single person earns less than $90,000pa or less than $120,000pa for a couple.
The promise to address housing affordability is a key part of the Labor Government’s election campaign, with the Federal election set for Saturday, 21 May.
Mr Fitzgerald, who launched a campaign for affordable housing through the pages of the Gazette on 6 April, said Labor’s commitment “made sense“.
“Labor’s policy certainly will assist people in that income bracket get into the housing market,“ Mr Fitzgerald said.
“The crisis in housing affordability, with vast sections of the community not only being priced out of the housing market but also the rental market, requires drastic intervention.“
Mr Fitzgerald, the former Outlook CEO who lives in Garfield North, said housing repayment and rental cost should not exceed more than 25 per cent of income.
“This allows for adequate expendable income on food, clothing, energy costs, entertainment and savings,” he said.
“That rule of thumb is right out the window at the moment with more and more people facing homelessness, food bank queues and descending into poverty”.
Mr Albanese said the policy would allow Australians to buy a home with a smaller deposit and mortgage.
“After nine long years in government, housing affordability has only got worse under the Liberal-National Government,” Mr Albanese said.
Home buyers will need to have a deposit of two per cent and qualify for a standard home loan with a participating lender to finance the remainder of the purchase.
They will not be required to pay rent on the stake of the home owned by the Federal Government and will be able to buy an additional stake in the home during the loan period.
Help to Buy will cost around $329 million.
Labor Shadow Minister for Housing Jason Clare said the policy will help Australians on low and modest incomes to buy a home.
“This will help a lot of Australians buy a home with a smaller mortgage that they can afford to repay, instead of renting for the rest of their lives,“ he said.
The Greens has also announced a push to establish a Federal Housing Trust, building one million new homes over 20 years to ensure there is a home for all.
Starting in 2020, the Federal Government’s First Home Guarantee allowed first time buyers the opportunity to purchase a home with a deposit of as little as five per cent rather than 20 per cent.
