More than 1 million vulnerable Australian households will get a helping hand with their rental payments amid rising rates.
Recipients of the Commonwealth Rent Assistance payment will see an increased rate, it was announced in the federal budget.
Low-income households who rent will see the maximum rates of the payment increase by 15 per cent — or up to $31 per fortnight.
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The measure is estimated to cost the budget $2.7 billion over five years and will benefit 1.1 million households.
Treasurer Jim Chalmers said it was the largest commitment to the program in more than 30 years.
“For too long, secure, affordable housing has been out of reach for too many Australians.
“Tonight, to help ease the pressure on people feeling the pain of rising rents, we are increasing the maximum rate of Commonwealth Rent Assistance by 15 per cent.”
Read more of 7NEWS.com.au’s budget coverage
Budget papers say the move will help recipients manage cost-of-living pressures in the face of rent growth, and will help alleviate rental stress.
“Renters in Australia will be further supported through the National Cabinet commissioned reforms to strengthen renters’ rights across the country.”
The payment wasn’t the only measure in the budget directed at the housing market. More details of the government’s Housing Accord, first unveiled in the October budget, were also revealed.
The plan aims to build 1 million new, well-located homes over five years from 2024.
An increased supply of homes would, in theory, drive down demand and prices.
The Housing Accord will be driven by a new tax break for build-to-rent projects, the budget revealed, cutting the managed investment trust withholding tax in half from 30 per cent.
It will also increase the capital works tax deduction from 2.5 per cent to 4 per cent per year.
Budget papers say that as many as 150,000 rental properties could be added to the market over a decade due to the tax reforms, “boosting the supply of high-quality, long-term rentals in the Australian market”.
Social and affordable housing also received a boost in Tuesday’s budget.
The cap on liabilities for the National Housing Finance and Investment Corporation was increased by $2 billion.
Chalmers said this means that more lending will be available to community housing providers.
For first home buyers, an expansion to the first home guarantee scheme was formalised in the budget.
The first home guarantee and its regional and family home equivalents will have their criteria expanded from July 1, to help more Australians achieve homeownership.
The changes include altering the definition of a “couple” from meaning married or de facto relationships to “any two eligible individuals”.
This opens up the criteria to include siblings, a parent and child, or two friends.
People who have previously owned a home will also be eligible, on the provision they haven’t owned one in the last 10 years, in a bid to help those who had fallen into financial hardship.
Under the schemes, the federal government acts as guarantor which allows people to buy a house with a deposit as low as five per cent, and avoid paying costly lender’s mortgage insurance.
Australian permanent residents will also be eligible for the schemes, rather than just citizens.
Housing Minister Julie Collins said the government was “moving to meet the times”.
“We know friends and family members are already teaming up to secure their own place to call home,” she said.
“Our actions will allow them to access vital assistance, just as couples have been able to previously.”
In total, 35,000 first homebuyer spots are available each year, with 10,000 for the regional first homebuyer guarantee, and 5000 for the family home guarantee.
Improving access to affordable housing was one of five fields prominently featured in the government’s cost-of-living relief plan on Tuesday.
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