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- Changes afoot across housing, energy and super from 1 July 2023 – what it means for your hip pocket
Changes afoot across housing, energy and super from 1 July 2023 – what it means for your hip pocket
A raft of changes are coming into effect from 1 July, as new policies, prices, thresholds and eligibility criteria move into the new financial year.
From young Australians looking to buy their first home to retirees dependent on the pension, new rules will have some pocketing more dollars, while others are forced to pay more.
RateCity.com.au has compiled a list of major changes that could see a material impact to your bank account.
Key changes include:
- Increase to the childcare rebate (from 10 July).
- Release of 50,000 new places in the Home Guarantee Scheme with wider eligibility conditions.
- Increase to electricity prices up to 25%.
- Increase to the Super Guarantee from 10.5% to 11%.
- Increase the Age Pension Age to 67.
NATIONAL CHANGES THAT COULD AFFECT YOUR HIP POCKET 1 JULY 2023
| What | Who will it impact | Details |
| Compulsory super lifts to 11% | Employees | The super guarantee rate increases from 10.5 per cent to 11 per cent of a person's ordinary time earnings. |
| Energy price rises | Households | Electricity customers are likely to see price rises of up to 25% after regulators in NSW, south-east Queensland, South Australia and Victoria, announce their DMO determinations. |
| Increase to the Child Care Subsidy | Parents with children at primary school or below earning less than a combined $530K | From 10 July, the maximum Child Care Subsidy rebate is increasing from 85% to 90% for families earning less than $80K per year, while families earning up to $530K will be eligible for some level of subsidy, based on their income (limit was previously $356,756). |
| Minimum wage rise | Workers on the minimum wage or award minimum wage | The minimum wage will increase to $23.23 per hour from $21.38 per hour (0.7% of working population).
Award workers on minimum wages will get a 5.75% pay increase (20.5% of working population). |
| 50,000 new Home Guarantee places + change to criteria | Home buyers with small deposits | 35,000 new places in the First Home Guarantee, 10,000 places in the Regional First Home Buyer Guarantee, and 5,000 places in the Family Home Guarantee become available.
The eligibility criteria now include permanent residents. The First Home and Regional schemes will expand to include former homeowners and friends and family being able to buy together. The single parent guarantee is set to include legal guardians. |
| Westpac joins the Home Guarantee Scheme | Greater choice for people using the Home Guarantee scheme. | Big four bank Westpac joins the scheme from 1 July, along with RAMS. |
| Greater flexibility for Paid Parental Leave | Expecting parents | Paid Parental Leave and Dad and Partner Pay will combine to provide families with a total of 20 weeks (previously 18 and 2), however, both parents must take at least 2 weeks but can now take it in multiple blocks and at the same time. Single parents get the full 20 weeks.
There is a new income cap of $350,000 per family. Amount paid is based on the minimum wage and will therefore also increase on 1 July. |
| Increase to the Age Pension Age | People nearing retirement | The eligibility age for the Age Pension has been gradually increasing since July 2017. It reaches 67 on 1 July for people born on or after 1 January 1957. |
| Increases to asset and income test | Retirees | The amount of income retirees can earn and the assets they can hold before it affects their pension increase as a result of on 1 July. Full details here. |
| End of temporary lowering of super drawdown rate | People with a pension account | The minimum amount people with a pension account must withdraw from their super increases back to pre-pandemic levels, after the government's temporary reduction of this rate during COVID. |
| Increase to Medicare Levy Surcharge threshold | Singles earning between $90,000 and $144,000 with no private health insurance | People earning up to $93,000 (previously $90,000) or $186,000 as a family (previously $180,000) are exempt from paying the Medicare levy surcharge if they don't have private health cover. |
| Westpac, NAB home loan cashback offers end | Refinancers | From 1 July, Westpac and NAB cashback offers cease to exist. CBA's cashback offer finished 31 May. |
NSW CHANGES FROM 1 JULY 2023
| What | Who will it impact | Details |
| Increase to first home buyer stamp duty exemption | First home buyers in NSW | From 1 July first home buyers purchasing properties worth up to $800,000 won't have to pay stamp duty in NSW (previously $650,000), while properties worth up to $1 million will still attract some sort of stamp duty discount (previously $800,000).
Includes a new requirement to live in the home for 12 months instead of 6, as is the case for the first home-owner grant and other schemes. |
| End to land tax option for first home buyers | First home buyers in NSW | The scheme, which allows first home buyers to choose between paying stamp duty and an annual land tax, ends 30 June. However the rules will still apply for anyone who opted into the scheme while it was open. |
QUEENSLAND CHANGES FROM 1 JULY 2023
| What | Who will it impact | Details |
| Rental reform | Renters in QLD | Landlords can only increase a tenant's rent once every 12 months, up from 6 months. Full details here. |
ACT CHANGES FROM 1 JULY 2023
| What | Who will it impact | Details |
| Stamp duty waiver for used hybrid cars | People buying a second-hand hybrid car | Used hybrids and plug-in hybrid electric cars join the ACT's list of vehicles that will no longer attract stamp duty charges when purchased.
Cars must not have tailpipe emissions of 130g / km of CO2 or more. |
RateCity.com.au research director, Sally Tindall, said: “Another 50,000 places in the government’s Home Guarantee Scheme will help fast track people’s property buying plans, but borrowers should be extremely cautious when purchasing a home with a wafer-thin deposit.”
“While thousands of first home buyers who bought using the scheme before the 2021 boom are now likely to be swimming in equity, more recent borrowers who overstretched themselves with next-to-no buffer could already be in hot water,” she said.
“Buying with a small deposit has the capacity to put borrowers on the back foot from the outset. Not only will you be signing up to a larger debt, but your bank is likely to sting you with higher rates because you’ll be classified as risky.
“For example, CBA’s lowest variable rate for someone with a 5 per cent deposit is a hefty 7.49 per cent – that’s a 1.25 percentage point penalty when compared to the bank’s lowest rate loan.
“The boost to the childcare subsidy will be a game changer for many mums and dads who’ve opted to stay at home to look after the kids because it just wasn’t cost effective to be in the workforce.
“Parenthood is a juggling act both practically and financially. Giving parents a greater range of options and support is exactly what they need.
“The start of the new financial year marks another important milestone in the march towards a super guaranteed rate of 12 per cent.
“This move will see more Australians look forward to retirement, rather than dread the day their bank accounts run dry,” she said.
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