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The Help to Buy legislation is set to be reintroduced to Parliament next week, raising the prospects of a double dissolution.
In mid-September, the government attempted to bring a vote on its Help to Buy legislation in the Senate, but failed in the task, with the Greens and Coalition successfully voting to table the issue until November.
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Considering that to be tantamount to defeat, the government has now said that it will reintroduce the bill to create the shared equity scheme next week. If the legislation is once again rejected by the Senate, this could open the door for the Prime Minister to call for a double dissolution of Parliament.
A double dissolution election can be called by the Prime Minister when the upper house rejects a government bill twice over at least three months. In this case, the Senate delay is being taken as the first “failure to pass”. Although already within the window to hold a regular election, if the correct circumstances were met, the government might choose to call a double dissolution, as it puts every Senate seat into question, rather than the usual 50 per cent.
While the possibility of a double dissolution election is still considered unlikely given that several hurdles still stand in the way, Minister for Housing Clare O’Neil told the ABC this week that a double dissolution election should be considered a “serious proposition” at this point.
“We do need a circuit breaker,” she said.
Minister O’Neil accused the Greens and the Liberals of “doing everything they can” to stop the government from making progress on the legislation, which would institute a program that supports 40,000 people over four years into home ownership, with the government committing 40 per cent towards the purchase price of a new home and 30 per cent towards an existing home.
Price caps for the maximum purchase price would be set depending on the property’s location, with the government retaining its equity share and being repaid upon the sale of the property, or the owner would make incremental payments to buy out the government’s portion of the home.
While the Coalition opposes the shared equity plan outright, the Greens have said they are willing to negotiate. At the first introduction of the bill, the minor party asked for significant changes to negative gearing policy and the capital gains tax discount, as well as rental freezes and other housing measures in return for its members’ support.
After the September delay, Greens Leader Adam Bandt signalled that the party might be willing to support the legislation with just a partial concession from the government.
What is the Help to Buy scheme?
Labor’s Help to Buy scheme was first announced by the Albanese government in 2022 as part of the safer and more affordable housing measure. It aimed to support up to 40,000 Australian households to purchase their own home.
Under Help to Buy, low- to middle-income earners would only be required to have a deposit of 2 per cent (or more) to qualify for a standard home loan with a participating lender without needing to pay lenders mortgage insurance (LMI).
The Commonwealth would provide an equity contribution to eligible participants for up to 40 per cent of the purchase price for new homes and up to 30 per cent for existing homes, which will be recognised as a second mortgage (or other right secured against the property).
The scheme – which would be administered by Housing Australia – will be means-tested (income limits are $90,000 for singles and $120,000 for couples) with property price caps for each city and region.
The bill to bring the scheme into being has been in a quagmire since February, with the Coalition opposing the scheme entirely and the Greens refusing to vote for the bill until changes are made (for example, by making tax changes for investors, such as removing negative gearing, etc).
[Related: Help to Buy scheme vote delayed to November]
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