A social housing construction boom and increased rental support payments will be critical to economic recovery, experts are warning ahead of the federal budget to be released on Tuesday.
The federal government has already announced some housing stimuli, with the extension of the First Home Loan Deposit Scheme, and is expected to also extend the HomeBuilder scheme to help support the construction sector.
But it’s spending big on social housing that will be key to providing a boost to the struggling industry, and supporting the growing number of Australians at risk of homelessness in the wake of the coronavirus pandemic, experts say.
“Instead of extending HomeBuilder they should be putting money on social housing,” said Brendan Coates, household finances program director at the Grattan Institute.
Mr Coates said HomeBuilder had brought forward purchases and renovations which would have happened anyway, with such schemes typically followed by a lull in construction – meaning it was unclear how much more demand there would be for it.
He added HomeBuilder also did little to support much-needed high density construction in inner and middle-ring suburbs.
Construction job losses were already mounting, Mr Coates said, noting the sector could lose between 12 to 18 per cent of all jobs by early 2021, with economic analysis by global consulting group McKinsey estimating between 150,000 and 205,000 construction jobs could be lost over the year to March.
“The budget should include a sizeable commitment to social housing. We know it’s a very effective stimulus, and it’s faster to roll out than most other infrastructure projects,” Mr Coates said.