Buying your first home in Australia can be a daunting (and expensive!) prospect. Luckily, there are a few schemes and tips that can help you on your way.
Buying your first home can be exciting and frustrating and slightly terrifying, all at the same time. It’s a big step for anyone. And given your home is likely the biggest purchase you’ll ever make, it’s a key time to align your banking with your values.
Even though Australian property prices are on the rise (again) there are a few government schemes that are making it easier for first home buyers to jump into the market.
We’ve rounded up some of the major ones here, but it’s always worth chatting to your mortgage broker or adviser. They’ll know which programs you qualify for. Also, just a heads up: some of these schemes are time-sensitive. The early bird gets the discount.
First Home Loan Deposit Scheme
Usually, if you’re buying a house with less than 20% deposit, you need to pay something called lenders mortgage insurance (LMI). It’s an additional cost, on top of your regular mortgage repayments. But thanks to the federal government’s new First Home Loan Deposit Scheme (FHLDS), first home buyers can buy or build a new home with as little as 5% deposit (subject to your lender’s regular criteria). There are limited spots for this one, and it only applies to new-builds, or off-the-plan dwellings.
We have a range of loans available to first-home buyers. Find out more about what’s best for you here.
And while we’re talking about deposits, in the lead up to buying your first home, it’s important to plan, budget and save! After all, the more you save, the less you’ll need to borrow. Check out our Home Loan Borrowing Power calculator to find out how much you may be eligible for.
First Home Owner Grant
Most state governments have their own First Home Owner Grant systems. These have been around for a while. In Victoria, for instance, you can get $10,000 when you buy or build a brand new home (it goes up to $20,000 in regional Victoria, at least until 30 June 2021.) Queensland has a similar program. Most First Home Owner Grants have purchase price limits—your home generally needs to be under $750,000, but it varies state-by-state. Check your relevant government website for all the details.
On 29 November 2020, the federal government announced the new HomeBuilder scheme. You’ve probably seen this one on the news. If you entered into a contract before 31 December 2020 to build or renovate a new home, the government would give you up to $25,000 towards the project. This applied to first home buyers, too. The amount has decreased slightly since then: to qualify for $15,000 assistance, you need to enter into a contract to build a new home or buy off-the-plan before 4 June 2021 (FYI: your application needs to be submitted before 14 April 2021.)
Stamp Duty Waiver
Most states will waive stamp duty (also known as land tax) for first home buyers, as long as your house is under a certain price threshold. Victoria has actually gone one step better and introduced a comprehensive stamp duty waiver. This one’s pretty amazing: until 1 July 2021, you can get 25% off your stamp duty for existing residential properties, and a whopping 50% off for new builds and off-the-plan developments. This is for houses up to $1 million, and it’s on top of all the existing schemes and benefits listed above. Not too shabby.
Buying a home is a big investment – probably one of the biggest you’ll ever make! We’re here to help. Find out more about what’s involved, from planning to financing to purchasing, now.
What is Clean Money?
Do you know your choice of bank can have a huge impact on the world? Learn about clean money and how your banking can do good, not harm.