Once upon a time city-siders would flock to regional areas for reprieve from the exorbitant house prices in search of a reasonably priced way of entering the real estate market.

Now, with regional demand ramping up and supply remaining low, the nation looked on to see if the Federal Budget would offer the answers to the growing housing crisis that has captured the country. 

This week’s budget included two major investments for housing, including up to 35,000 places per year for first home buyers under the First Home Guarantee, and a new Regional Home Guarantee Scheme with up to 10,000 places per year will help aspiring homebuyers in regional areas.

The Regional Home Guarantee Scheme will offer eligible homebuyers in rural and regional areas the opportunity to build or buy a newly-built home. The deposit could be as low as 5 per cent.

Domain’s Chief of Economics and Research Dr Nicola Powell said that this investment will be beneficial, but is hardly a solution to the issue at large.

“I think what the budget does look at the affordability of being able to gain access to the market but what it isn’t addressing is the availability of affordable properties for sale,” Dr Powell said.

Where there are houses for sale or land to build on, the scheme could potentially ‘supercharge’ someone’s market access. Where there is not, it may be redundant.

“As we’re talking about the lower end of the market, we need to complement that with additional housing supply to allow those term buyers choice on the market. One of the things we’ve seen since the pandemic is dwindling supply overall and less choice on the market, and that supply side really needs answering,” Dr Powell said.

What was also missing from the budget, was any financial response to the recent Inquiry for Supply and Affordable Housing, which had recommendations released last week.

“There is nothing in the budget that addresses that…I think what we would have liked to have seen is reducing red tape and looking at an increase in land releases,” Dr Powell said.

Some local councils have taken up the challenge to look at ways to increase the supply of housing in their areas.

Gilgandra Shire Council's Draft Housing Strategy closed for comment earlier this week.

“Housing and accommodation shortage is not unique to Gilgandra," said Gilgandra Mayor, Councillor Doug Batten.

"Council has been gathering data and insights into our local housing trends over recent months and it has become clear that demand for housing and accommodation is very strong and cannot be met with current housing stock or available land."

"We want people to call Gilgandra home and one way we can respond is by ensuring there are housing and land options available to meet the need," Mr Batten said.

As the Regional Home Guarantee Scheme allows for the building of new homes, Dr Powell says land releases for residential areas should become a high priority. 

“It’s also ensuring that these regional areas have the infrastructure and the amenities that can support a growing population…building roads, building the infrastructure, building the schools, having the hospitals.”

House prices in regional NSW leaped by 28 per cent over the 2021 calendar year, creating a medium price of 720,000. For those who weren’t in the market already, the stakes have dramatically risen. 

While those looking to enter the market may get a leg up, the budget provided little for renters and to alleviate the demand for social housing.

National Spokesperson for Everybody’s Home Kate Colvin said the budget was a profound disappointment. 

“For the last two years workers in industries such as aged care, child-care and retail have been lauded as heroes of the pandemic. But the budget has done nothing to help them out of the rental pincer. People on low and modest incomes need real housing solutions, instead they are getting rhetoric and bandaids,” Ms Colvin said. 

“The Federal Government cannot continue to shirk its responsibility,” Kate Colvin said. “Social and affordable housing has been an area of shared responsibility since the first social housing was created in the 1940s.” 

The Budget can be found here.