First Home Buyer Grants and benefits

First Home Buyer Grants and benefits: how do they work in Australia?

As a first home buyer, there are many different terms you will need to become familiar with, from Lenders’ Mortgage Insurance (LMI) to stamp duty. You’ll also need to research to determine if any resources are available to assist you along your property journey — an experienced mortgage broker can help you with this. 

If you are planning to buy a house in Australia for the first time, the two very important questions you should ask your mortgage broker are: “What first home buyer grants are currently available out there?” and “Do I qualify for any?”

The Australian government offers some grants, concessions and schemes to encourage first home buyers to purchase a property. These benefits are administered under each state and territory legislation, which means it varies depending on where you intend to buy the house. The good news is, when used correctly, these grants can give you the financial assistance you need to access your dream home. However, that’s not to say they’re the simplest concepts to get your head around.To simplify things for you, we decided to put together some general information about the government Incentives, like the first home buyers grant that is available in 2021 and the following years:

What grants are available for first home buyers in Australia?

As a result of skyrocketing property prices, the Australian government launched various grants to assist first home buyers. These grants provide various financial assistance to ensure prospective buyers make their mark on the property ladder. Let’s explore some of these grants in more detail:

First Time Home Owners Grant (FHOG)

The First Home Owner Grant (FHOG) is an incentive for buying or building a new house for the first time and living there for at least 6 months. This is a national scheme that reduces the impact of the GST on home prices. It basically helps you increase your deposit, which may improve your eligibility for a home loan.

Under the scheme, a one-off grant applies to first homeowners that satisfy all the eligibility criteria. We’ll explore the eligibility criteria for this grant in greater detail later.

First Home Super Saver Scheme (FHSS)

The FHSS scheme allows permanent residents and Australian citizens to save up to $30,000 to buy their first house in extra voluntary contributions to their superannuation fund. This incentive is valid for the whole country. To be eligible for this grant, applicants must have never owned a property in Australia, including vacant land or commercial property, and have not previously made a FHSS release request under the FHSS scheme.

Stamp duty concessions 

Stamp duty is often regarded as one of the significant upfront costs buyers need to provide when purchasing a property. To ease the financial burden, stamp duty concessions are available to first home buyers.

The benefit applies to first home buyers purchasing new or existing homes. It allows them to access up to a full tax concession, depending on the property’s price and the state or territory they are buying at. 

First home loan deposit scheme

Under the FHLDS the Government guarantees 15% to the lender and allows eligible first home buyers or builders to purchase new properties with only 5% deposit, without having to pay the lender mortgage insurance (LMI). However, it is important to mention that this benefit has only 10,000 places available per financial year.

Now that you understand which grants are currently available and how they basically work, let’s see some examples of eligibility criteria by State:

First Home Buyer benefits in NSW

 

First Home Owner Grant 

New South Wales offers a $10,000 First Home Owner Grant for builders of new homes valued under $750,000 and purchases of new homes less than $600,000 in value.

Stamp duty concessions 

Properties up to $650,000 are eligible for a concession that may represent $24,740 on tax savings. The benefit can be extended for properties up to $800,000 with reduced discounts.

First Home Buyer benefits in VIC


First Home Owner Grant

In Victoria, the grant is worth $10,000 for first home buyers building or buying a new home in cities and $20,000 for regional areas, both for properties under $750,000.

Stamp duty concessions 

For properties up to $600,000, the concession will represent $31,070 on savings from tax. The benefit is also extended for properties up to $700,000 with reduced discounts. 

First Home Buyer benefits in QLD

First Home Owner Grant

From March 2021, existing or building houses up to $750,000 may be eligible for a $15,000 concession. People buying or building in regional areas might also be eligible for $5,000 as part of the regional home building grant.

Stamp duty concessions 

For properties up to $500,000, the concession will represent $8,750 on savings from tax. Properties up to $550,000 can also be part of the concession, however, with reduced discounts. 

First Home Buyer benefits in SA

First Home Owner Grant

In South Australia, first home buyers may be eligible for up to $15,000 to buy or build a new house less than $575,000 in value.

Find out which government grant is best for you

Navigating the property world can be overwhelming, especially when you’re a first home buyer — but we can help you. From sourcing the best home loan deals to mastering your property buying lingo, Capta Financial is your trusted support system. 

If you plan to buy a house in Australia in 2021, we will be more than happy to help you understand which of the first home buyer grants you would qualify for and assist with the application process. Explore our range of home-buying services and book an appointment with us today.

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