For many Australian first home buyers, 2020 has been a year of opportunity. According to the Australian Bureau of Statistics (ABS), around 13,040 first-home buyer loans were approved across Australia in September alone, largely as a result of record low interest rates, backed by several government initiatives. If you’re in the market for the first time, here’s a closer look at what benefits you may be eligible for.
First Home Loan Deposit Scheme
Designed to help first home buyers get into the property market sooner while boosting the residential building sector, the First Home Loan Deposit scheme has already helped 20,000 first home buyers since the start of 2020.
With as little as a 5 per cent deposit, first home buyers may be able to buy a newly-built home or build a new home, with government guaranteeing the remaining 15 per cent deposit required by participating lenders. The scheme could save first home buyers between $10,000 and $30,000 in Lenders Mortgage Insurance (LMI) fees.
Government has recently opened up the scheme to a further 10,000 first home buyers applying before June 30, 2021.
First Home Owner Grant
The First Home Owner Grant is a national scheme that varies from state to state and is a one-off grant payable to eligible first home buyers. To check your eligibility status, find out the conditions of the grant, and determine how much you could receive, select your state or territory here and enter your details.
Government’s HomeBuilder program in response to Coronavirus provides eligible homeowners or first home buyers with a $25,000 grant to use to build a new home or renovate an existing home.
The program has recently been updated with the following changes:
- A $15,000 grant for building contracts (new builds and substantial renovations) signed between 1 January 2021 and 31 March 2021, inclusive.
- An extended deadline for all applications to be submitted, including those applying for the $25,000 grant and the new $15,000 grant. Applications can now be submitted up until 14 April 2021 (inclusive). This will apply to all eligible contracts signed on or after 4 June 2020.
- An extension to the construction commencement timeframe from three months to six months for all HomeBuilder applicants. This will apply to all eligible contracts signed on or after 1 January 2021, but will also be backdated and apply to all contracts entered into on or after 4 June 2020.
- An increase to the property price cap for new build contracts in New South Wales and Victoria to $950,000 and $850,000, respectively, where the contract is signed between 1 January 2021 and 31 March 2021, inclusive.
- The existing new build property price cap of $750,000 will continue to apply in all other States and Territories.
Stamp Duty Exemption or Concession
We’ve outlined some of the changes to stamp duty in various states in a recent blog. You can find more on this here.
It’s heartening to see more first home buyers entering the market. With an improvement in housing affordability, a downturn in mortgage rates, and additional incentives for first home buyers, now may be the best time for first home buyers - who may have been hesitating – to get a foot onto the property ladder.
If you’d like to find out more about buying your first home and accessing any of the incentives above, please talk to our team first.
While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken by Finservice Pty Ltd (Mortgage Express) for any errors or omissions. This publication does not constitute personalised financial advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. A Disclosure Statement is available on request and free of charge.
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