The Australian Government has set up certain Schemes and Grants that would help first-time home buyers to achieve their dreams faster.
Government first home buyer schemes can be categorized based on whether the buyers will be eligible for Nationwide schemes or State-Specific Grants.
Let’s get into the difference and inclusions between the two!
1. National Schemes
a. Home Guarantee Scheme
It is a government initiative to help Australians achieve home ownership by removing the requirement of paying Lenders Mortgage Insurance (LMI).
The scheme now includes two guarantees.
- First Home Guarantee (FHBG)
- For Eligible First Home Buyers
- Previously known as ‘First Home Loan Deposit Scheme or FHLDS’
- The minimum downpayment required is 5%
- Family Home Guarantee (FHG)
- For Eligible Single Parents
- The minimum downpayment required is 2%
b. First Home Super Saver Scheme
This scheme is aimed at assisting the buyer to purchase their first home. This is achieved through allowing voluntary contributions to be made to superannuation and subsequently withdrawn to pay a deposit for the first home.
c. Regional FHB Support Scheme
With rents going up and vacancy rates the lowest they’ve been in decades in many areas, would-be buyers are being thrown a lifeline to help them purchase a home without having to pay many of the associated costs that come with not having a 20% deposit.
The Regional First Home Buyer Support Scheme is designed to assist those looking to buy their first property in regional Australia (i.e. Lake Macquarie, Adelaide Park, Illawara, etc.) Under this scheme (starting in Jan 2023), first home buyers looking at regional areas can secure a home with a deposit as low as 5%.
d. Help To Buy Scheme
Also known as Government Equity Loan Scheme and commenced in 2023. This is a shared equity scheme that will allow eligible home buyers to purchase a property with a smaller deposit.
The buyers would only need to save up at least 2% of the purchase price and they may be given the chance to borrow from the government up to 40% of the purchase price of a new home and up to 30% for an existing home.
2. State-Specific Schemes
a. Home Builder Scheme
This scheme will provide eligible owner-occupiers (including first home buyers) with a grant of $25,000 to build a new home or substantially renovate an existing home. This is a time-limited scheme wherein applications will only be accepted until April 30, 2023.
More information on the Home Builder Scheme here.
b. First Home Buyers Assistance Scheme (FHBAS)
The allows eligible first home buyers in NSW to get a full or partial exemption on stamp duty fees.
This scheme applies to the following:
• Existing Homes – existing properties valued at less than $650,000 apply a full exemption on paying stamp duty, while properties worth $650,000 – $800,000 apply for a concessional stamp duty rate
• New Homes – new properties valued at less than $650,000 apply a full exemption on paying stamp duty, while properties worth $650,000 – $800,000 apply for a concessional stamp duty rate
• Vacant Land – full exemption on stamp duty will be applied for land valued at less than $350,000 while concessional stamp duty rate applies for lands valued between $350,000 to $450,000
You can check if you are eligible for full or partial stamp duty exemption using the FHBAS Calculator.
More information, about the FHBAS here.
c. First Home Owner Grant (FHOG)
This is a one-off payment to encourage and assist first home buyers to buy or build a new residential property for use as their principal place of residence.
A grant amounting to $10,000 will be given to eligible buyers who will buy/build a new property which can be a house, townhouse, apartment, unit or similar that is newly build, purchased off-the-plan or substantially renovated.
More information on First Home Owner Grant here.
d. First Home Buyer Choice
The First Home Buyer Choice Scheme is a program that provides first-home buyers with the choice to pay a one-off upfront stamp duty tax or to pay an annual property tax.
Paying Stamp duty means significant upfront costs for aspiring homeowners. With the option to pay land tax each year, first-time home buyers can spread their expenses rather than cough up a large sum in one go.
To be eligible for this scheme, value of new or existing homes should not exceed $1,500,000 while the value of vacant lands should not exceed $800,000.
You can use the First Home Buyer Choice Calculator to calculate the upfront Transfer/Stamp Duty Fees and the Annual Property Tax amount.
More information on First Home Buyer Choice here.
