Are you making the most of First Home Owner Grants?

So you’ve decided its time to put down some roots and get your foot on the property ladder. And if you’re a first time home buyer, you’ll be pleased to know there are grants available that can help make the process a whole lot easier and less of a drain on the hip pocket!

If you're thinking of buying or building a new home, this could be what gets you started, it could get you something more than you were expecting and it can get you into your first home sooner.

The First Home Owner Grant was established by the Australian Federal Government in 2000 to help get people into their own homes. The scheme is available throughout the country and as it is funded by each state and territory government, grant amounts differ depending on location. Of course, there are plenty of eligibility criteria that must be met in order to access the money so if you are thinking of purchasing a property in QLD or NSW you might just find the following very helpful indeed.

Let’s start with the sunshine state of QLD. The First Home Owners’ Grant is a one-off payment of $20,000 to help you buy a new home.  This grant has been extended to 30 June 2018 following last year's election so make the most of it whilst it's on offer!   How do you access it I hear you ask? The basics - you or your partner must be an Australian citizen or permanent resident; you must be a first time home-buyer; and you must be over 18 years of age.

Now this $20,000 can only be used for the purchase of a new dwelling such as a newly built house, unit, granny flat, duplex or townhouse; a home that has been substantially renovated (essentially one that has been completely gutted and rebuilt from the inside out); or removal homes that have been moved from one site to another that have not been occupied since its relocation. You must move into the new home within 12 months of the completed transaction and then live there for a continuous period of 6 months. Finally, the home must be valued under $750,000 which should get you something pretty nice!

For first home buyers looking to buy a newly built home in Qld, there's an additional benefit of transfer duty exemption on residential properties up to $500,000, subject to eligibility, and this can make a significant difference in reducing the funding you need for your first home purchase, so it's well worth taking into consideration when you are looking at price points.

Now if you’re thinking of purchasing property in NSW, the grant amount under the First Home Owner Grant (New Homes) scheme is a little less than what is on offer in QLD, being $10,000. The eligibility basics are pretty much the same as QLD’s eligibility criteria, although the scheme specifies that all applicants must be natural persons and not a company or trust.

If purchasing a newly built home, the value of the dwelling can not exceed $600,000. For a property that you enter into a contract to build or for you more adventurous owner-builder types, the value is capped at $750,000. New homes also include those that have been substantially renovated or dwellings that have been built to replace demolished premises. Again, you must live in the property for a continuous 6 month period although active members of the Australian Defence Force may be eligible for an exemption from this residence requirement.

First home buyers in NSW also have access to another grant – the First Home Buyers Assistance Scheme which provides transfer duty exemptions or concessions on new homes and vacant land which you intend to build on. Under this scheme, eligible purchasers are provided transfer duty exemptions on new homes valued up to $650,000 while concessions are provided on new homes valued between $650,000 and $800,000. For those buying vacant land, they will be exempt from paying duty on land valued up to $350,000 or will be eligible for concessions on land valued between $350,000 and $450,000. The eligibility criteria for this scheme are much the same as that of the First Home Owner Grant although there are stringent proof-of-identity requirements in place.

Our Stamp Duty Calculator can help you calculate what stamp duty will be payable on a property purchase:

Stamp Duty Calculator

In a nutshell, there are a number funding options to assist you to get your foot on the property ladder and move into your own home sooner. We can help you navigate your way through the home buying process, determine which grant is best for you and take the hard work out of applying so please give us a call when you’re ready to make that new home all yours and check out some of the latest house and land opportunities available.

Links:

https://firsthomeowners.initiatives.qld.gov.au/

https://www.treasury.qld.gov.au/taxes-and-royalties/transfer-duty-first-home-buyer-grants-estimator/

http://www.revenue.nsw.gov.au/grants/fhog

http://www.revenue.nsw.gov.au/grants/fhba

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Disclaimer:  Any statements or comments made are general in nature and are neither given nor to be taken as financial advice.