First Home Buyer
Buying your first home can be both an exciting and daunting task. It can be challenging and expensive if you don’t have all the facts, hence why it’s important to get it right. If you haven’t check out our buying process, you can head over here(link) to educate yourself on the process.
We have compiled some information here to help you make informed decisions when it comes to buying your first home. This includes various government grants and schemes for eligible first-home buyers. These government grants are put into place to help first-home buyers get into the property market.
First Home Owner Grant
With the First Home Owner Grant, you may be eligible to $10,000 when purchasing new property under $750,000 and $20,000 when purchasing new property under $750,000 in Regional Victoria.
If your property purchase price is less than $600,000, the stamp duty fees will be waived. Property with a purchase price of $600,000 - $750,000 will have a discounted stamp duty fee.
So what are the conditions of this grant?
Firstly, as mentioned above, the property’s purchase price must be $750,000 and below.
Secondly, the purchased property can be an apartment, townhouse, house, unit or similar, but it must be less than five years old.
Finally, your purchased home with the First Home Owner Grant has to be your principal place of residence for at least 12 months. This means you can’t buy a property with the First Home Owner Grant and rent it out immediately.
If your spouse or partner have already received the First Home Owner Grant, or have bought a property to live in previously, you will not be eligible to the First Home Owner Grant.
First Home Loan Deposit Scheme
Similar to the First Home Owner Grant, the First Home Loan Deposit Scheme is designed to help first home owners get into the property market sooner. It allows first home buyers to purchase a property with as little as 5% deposit and without the need to purchase lenders mortgage insurance.
Normally, home buyers are required to purchase a lenders mortgage insurance if the deposit for the property is less than 20%. With the First Home Loan Deposit Scheme, the government will guarantee the difference between the deposit the first home buyer has saved up, and the 20% threshold mortgagees usually require before they provide a home loan without lenders mortgage insurance. According to the government, this could save first home buyers as much as $10,000.
One of the restrictions of this grant is the $600,000 limit on the property purchase price, and the property has to be bought to be your principal place of residence, similar to the First Home Owner Grant. There are also other conditions such as salary threshold, your home loan and amount of deposit saved. Fortunately, you can apply for the First Home Loan Deposit Scheme in conjunction with the First Home Owner Grant.
First Home Super Saver Scheme
The First Home Super Saver Scheme was introduced to reduce pressure on housing affordability by the Australian Government. This scheme allows first home buyers to save up for a deposit on a new home inside your superannuation fund. With the concessional tax treatment of superannuation, first home buyers will be able to save up for a deposit faster.
The First Home Super Saver Scheme allows you to make voluntary concessional (before-tax) and voluntary non-concessional (after-tax) contributions into your superannuation fund to save for your first home. You can then apply to release your voluntary contributions, along with associated earnings to help pay on the deposit of your first home. Similar to the previous grants, you have to meet the requirements to be eligible to apply for the release of these funds.
To be eligible for the First Home Super Saver Scheme, you must not have previously own a property. The property must also be your principal place of residence after the purchase. You can apply to have a maximum of $15,000 of your voluntary contributions from one financial year, or up to $30,000 voluntary contributions across all years to be released under the First Home Super Saver Scheme. Any earnings that relate from these contributions will be released to you.
These are 3 grants that you can apply for if you are buying a property under $750,000. If you are eligible for these grants, it can possibly save you tens of thousands of dollars.
If you have any questions, please don’t hesitate to contact me at [email protected] and I will be glad to provide you with further information.