Australia’s construction sector might be receiving a boost it does not need, after recent spending habits showed Australians are using their time in lockdown to renovate their homes, new research has revealed.
Under the Morrison scheme, eligible property owners could receive $25,000 in government support if they are completing a renovation project between $125,000-$750,0000.
According to Propertyology’s head of research, Simon Pressley, the scheme will help kick-start the construction industry through the opportunity of renovating a property.
“Normally, property sector stimulus is targeted at new dwellings – something Propertyology has never agreed with. A government policy which incorporates incentives for existing dwellings means that funding is reaching a much bigger critical mass,” Mr Pressley said.
Australia has 10.3 million existing dwellings compared with building 0.2 million new dwellings each year.
“Stimulating the renovation sector also means that the little guys and girls (local tradies) will get a lick of the ice cream, not just the big developers.”
However, analysis from Zip on its 1.8 million users showed that Australians began renovating their homes in May, well before the government’s package was announced.
“We have been particularly interested in the bolstering of spend in the past quarter on building and renovation, which is interesting in light of the recent government stimulus package,” Zip co-founder Peter Gray said.
The data revealed a 133 per cent increase in security and safety system installation, while spending on trade services was up 30 per cent.
“Security installation, roofing, gardening, outdoor home improvement and home pools and spas all saw significant increases in consumer spending in May 2020, while trade services like electricians, plumbers and painters were all sought after,” Zip’s report noted.
While many of these jobs might not have been large enough to qualify for the government’s $125,000 scheme, research by Zip showed the industry was well supported prior to government intervention.