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The federal government’s HomeBuilder subsidy had a tight 31 December deadline to qualify for $25,000 grants to underwrite the construction of new homes or major renovations.
For all intents and purposes, it was a stonking success, resulting in an unprecedented 92% rise in new home sales in December as buyers rushed to meet the deadline.
However, the problem with these types of schemes is that they typically pull forward demand, leaving a big demand hole once the subsidies expire.
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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.