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Hundreds of blocks sold every week: Surge spurs $30m boost to WA building bonus

The building bonus has been extended.

The building bonus has been extended.Credit:Paul Jeffers

Premier Mark McGowan said the state’s grants program, launched in June, had led to an enormous upsurge in the WA building industry.

“Combined with the Commonwealth grant it has driven enormous interest and enormous activity in land sales across Western Australia,” he said.

“We have seen around 500 blocks of land sold per week in Western Australia and that’s driven up demand for the building bonus across the state.”

He announced a new coronavirus support package, with the first part an additional $30 million to extend the building bonus program.

“This will allow many more people to be able to access this grant and ensure many people across the state are employed in building, particularly in residential construction,” Mr McGowan said.

Treasurer Ben Wyatt said the bonus was having an impact around the state and had been more popular than expected, with some towns seeing land sales after a long period of inactivity.

The July lending figures saw a 94 per cent increase in finance for not just owner-occupiers but investors as well. This was important, bearing in mind the tightening rental market.

He said land sales in regional WA were going “very well”.

“In some parts of Western Australia, [we’ve seen] land sales where we haven’t seen Development WA move a property in many years.

“The building bonus is certainly having an impact not just in metropolitan Perth but across Western Australia built around the fact Development WA has revalued their asset base.”

He said Treasury had expected a 12 per cent contraction in the economy in the June quarter, but only 6 per cent eventuated, a sign the state was doing better than expected.

“What is going incredibly well is the building bonus,” Mr Wyatt said.

“The border has allowed our businesses to get back to what they do best, which is operating in an unconstrained environment.”

Industry groups welcomed the extra funding but called for the bonus to be extended beyond December to smooth out the spike of expected work and avoid labour shortages.

Urban Development Institute of Australia WA chief executive Tanya Steinbeck said the higher demand reinforced the need for an extension to the delivery timeframes to allow industry to safely provide the houses.

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