FAQs on exemptions | Office of the Federal Safety Commissioner

FAQ 1: How do I determine if funding is assisting building work to proceed in relation to turnkey acquisitions of dwellings?

Guidelines for determining whether funding is assisting building work to proceed in relation to turnkey acquisitions of dwellings are provided below. Click on the boxes below to view the guidance for each possible funding arrangement.

1. Was construction completed before the funding recipient entered into any purchase or leasing agreement in relation to the dwellings?

2. Was construction started before the funding recipient entered into any purchase or leasing agreement in relation to the dwellings, but construction was completed by the time a commitment for funding is provided?

3. Where the funding is for acquisition of dwellings where construction is ongoing or has not started, is there a pre-construction agreement between the funding recipient and a builder, developer or other party?

4. Does the funding facilitate the pre-construction agreement?

Funding will not be regarded as facilitating the pre-construction agreement where that agreement was entered into before any commitment of funding and the agreement is not conditional on the provision of any funding, or a state or territory has committed to fund a party’s pre-construction agreement to acquire or lease dwellings and Housing Australia funding is only sought for availability payments and/or for a concessional loan to maintain the dwellings.

If yes, go to question 5.

If no, the Scheme does not apply because any building work will occur regardless of whether Housing Australia provides funding (Housing Australia funding is not facilitating building work but rather relating to the post construction use of the dwellings).

5. Does the funding recipient’s entry into the pre-construction agreement facilitate building work (that is, does the pre-construction agreement make a difference as to whether or not construction occurs)?

Notes

A pre-construction agreement means an agreement to lease or transfer land, a building or a part of a building on the condition, or on conditions that include the condition, that building work will be carried out on the land, the building or the part of the building.

In relation to resolving question 5 in relation to turnkey acquisitions of buildings, relevant factors include:

whether construction has already commenced on the dwellings or will commence prior to the commitment of Housing Australia funding, by the main works building contractor. Generally, a developer or builder is unlikely to commence construction unless they intend to complete the construction
whether the main works building contract has been executed and is either unconditional, or any condition relating to obtaining construction finance or presales has been met, or this will be the case prior to the commitment of Housing Australia funding
where the dwellings being acquired are an insubstantial or slight proportion of a much larger development (such as purchasing some apartments within a block of units).

FAQ 2: How do I determine if funding is assisting building work to proceed where the funding recipient already owns or leases the land and is directly engaging a builder to undertake building work?

Click on the boxes below to view guidance for this FAQ.

1. Will all building work be completed at the time Housing Australia makes a funding commitment?

2. Will construction proceed regardless of whether Housing Australia funding is provided?

Notes

In relation to resolving question 2 above in respect of funding recipients directly engaging a builder, relevant factors include:

whether construction had already commenced prior to the provision of any Housing Australia funding – construction generally will not commence unless it is intended to complete
whether, prior to the provision of any Housing Australia funding, a building contract had already been entered into with a builder where the contract is either unconditional or any condition(s) relating to the obtaining of finance had already been met
whether a state or territory had committed to provide necessary funding for construction that was not conditional upon Housing Australia funding.

Further assistance

To speak to an OFSC representative please call the OFSC Assist Line 1800 652 500, or email ofsc@dewr.gov.au.