Key Points
Labor will change the game for Tasmanian renters who don't currently own a home by enabling them to purchase a house with zero deposit.
This is based on the simple idea that if you can afford to pay the rent, you can afford to pay a mortgage.
We will do this by creating a new shared equity scheme, GameChanger, that will allow people to buy with zero deposit.
- The standard arrangement will be for the government to take a 20% share of the property, though higher shares will be considered where need can be demonstrated.
- The value of eligible properties will be capped at $600,000 for existing houses, and $800,000 for newly constructed homes.
- The scheme will be open to couples earning $200,000 or less, or singles earning $150,000 or less, with extra allowances for people with children.
- There will be no cap on the number of people who can participate, but the scheme will be reviewed after two years, with the possibility of extension.
- This will enable any Tasmanian renter who can afford their rent to get a foot in the door of home ownership.
At the same time, we’ll press ahead with our plan to build 2,000 new apartments, to open up more land for development, and encourage the construction of 1,000 new dedicated rental properties.
Why we need it
Average rents have nearly doubled after 10 years of the Liberals, rising more than $200 a week. Relative to income, Tasmania has the least affordable rental market in the country.
This has made it increasingly difficult for Tasmanians to save a deposit for a home. As a result, home ownership rates are in decline, and Tasmania now has the lowest percentage of home sales going to first home buyers in the country.
The number of homes sold to investors (2,465) is more than 30% higher than the number sold to first home buyers (1,881).
The details
The government will not charge any interest on its share, but will take a proportionate share of the final sale value (less any improvements made).
Owners can buy out the government at any time, or buy out part of the government’s share (at most recent valuation).
Owners will be responsible for maintenance, council rates, utility charges and conveyancing duties.
Participants will still have to qualify for a loan for the remainder of the value of the property, and will go through all the usual checks – except needing a deposit. That includes proof of income and assessment of their ability to manage interest rate rises.
The scheme is open to Tasmanians who do not currently own a home.
The approval process will be streamlined, with pre-approval an option.
The State Government will continue to partner with banks to deliver the program.