First home buyer grants and incentives currently on offer.
It is an exciting time to be a first home buyer in Australia. Never has there been so much money offered by the Federal and State Governments and this is creating a flurry of buying activity.
There are four types of Government incentives currently on offer for first home buyers as at 2nd February 2021:
First Home Owner Grant – this is a Federal initiative but administered by the States and offers $10-15K depending on the state or territory you are buying in. There are different price caps depending on where you buy and plenty of rules to follow.
Stamp duty concessions – these are State based concessions with price caps and a few rules around how long you have to live in the property.
First home loan deposit scheme – this is a Federal initiative that started in January 2020. It allows some first home buyers to purchase any property with only 5% deposit and avoid having to pay Lenders Mortgage Insurance – potentially saving thousands of dollars. There is a long list of rules, income caps, price limits and qualification criteria as well as a limit on the number of positions available and timeframes that you have to purchase within.
HomeBuilder grant – originally launched during COVID to stimulate the building industry, this was a $25K grant towards a new build or renovation. To qualify, the building contract initially had to be signed before 31/12/2020. This was subsequently extended to 31/3/2021 but the grant amount was reduced to $10,000. There are limits on the pre-renovation value of the property, building / renovation contract amount and income thresholds.
We are not going into great detail on each of these here but you can download our State by State Guide to Grants and Incentives to find out more about what is on offer in your state or territory and what the rules and limitations are for each one.
It is important to realise that these incentives are to stimulate the construction industry, which employs a million Australians, and therefore, is a significant boost to the economy. First home buyer grants are not there to help you get on the property ladder with a high quality property.
You may be wondering why we think this is such an issue.
If the grant and incentives were there purely to help first home buyers, then they would apply equally to established property as well as new builds.