First Home Owner Incentives

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There are a number of schemes and incentives to assist first home buyers in purchasing property. In order to be considered a first home buyer, the purchaser or their spouse (including de facto partner) must never have owned property in Australia.

1. First Home Buyer Assistance Scheme (FHBAS) - NSW

This scheme provides exemptions and concessional rates of stamp duty in New South Wales and applies to:

Buying an existing home

Full exemption for purchases less than $650,000
Concessional rates between $650,000 and $800,000

Buying a new home

Full exemption for purchases less than $800,000
Concessional rates between $800,000 and $1,000,000

Buying vacant land with the intention of building a home

Full exemption for land valued at less than $400,000
Concessional rates between $400,000 and $500,000

It is a requirement the purchaser must move into the property within 12 months of settlement and live there for a continuous period of at least 6 months, to be eligible for the FHBAS.

2. First Home Owner Grant (New Home) (FHOG) - NSW

A $10,000 grant is available for the purchase of a new or substantially renovated home.

Purchase price of new home must be less than $600,000
Total price of Land + Build must be less than $750,000

It is a requirement the purchaser must move into the property within 12 months of settlement and live there for a continuous period of at least 6 months, to be eligible for the FHOG. If purchasing land and building a new home, then the buyer must move in within 12 months of construction being completed.

3. First Home Loan Deposit Scheme (FHLDS)

This scheme enables first home buyers to purchase a property with a 5% deposit, without having to pay lenders mortgage insurance (LMI). The National Housing Finance and Investment Corporation guarantee 15% of the loan, there are 10,000 guarantees available per financial year.

Income Eligibility

Income must be less than $125,000 for singles
Combined Income must be less than $200,000 for couples

Price Caps

Cap on property price depends on location. For example, NSW Capital Cities and Regional Centres is capped at $700,000. Other parts of NSW the cap is $450,000.

Through our working relationship with Westpac, we are able to offer unique lending policies to assist First Home Buyers. Please contact us if you would like any further information on this unique offering.

4. HomeBuilder

This incentive is part of the Economic Response to the Coronavirus and provides eligible owner-occupiers with a grant of $25,000 to build a new home or substantially renovate an existing home. This grant is available to First Home Buyers, as well as those that have owner property before.

Contract must be signed between 4 June 2020 and 31 December 2020

Construction must commence within 3 months of contract date
Income must be less than $125,000 for singles and less than $200,000 combined income for couples
Newly Built home must have a value of less than $750,000
Substantial renovation contracts between $150,000 and $750,000 where the existing property value is less than $1,500,000.

An example of the financial benefit of these incentives is;

Dr John Lee and Dr Sally Lee enter into a contract for a Land and Build package at Box Hill for $730,000, neither of them have owned property before in Australia. Construction will commence within 3 months, they will move into the place within 12 months of completion and stay there for at least 6 months. John and Sally have a combined income of less than $200,000.

They are entitled to apply for ;

a full transfer duty exemption under the FHBAS, a saving of $28,185.
the FHOG and are eligible to receive the $10,000 grant.
the HomeBuilder and are eligible to receive the $25,000 grant.

John and Sally contact their adviser at Bongiorno and are able to arrange finance with a 5% deposit ($36,500), they are able to borrow the remaining 95% without paying LMI.

The total financial benefit received by John and Sally is $63,185 for a property purchase of $730,000.

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