Getting a Home Loan in Australia if you're living overs...
29 Nov 2023
If you’re a first home buyer, you’re likely looking to take advantage of all the first home buyer perks you can. One of these could be the First Home Owners Grant (FHOG); a grant offered to first home buyers to give them a leg-up when purchasing their first property.
Let’s discuss how the FHOG works, eligibility requirements, and more.
The First Home Owner Grant (FHOG) is a national scheme, but it’s funded by the individual state and territory governments. It was originally introduced to offset the effect of GST on home ownership, but is now more of an ‘economic stimulus tool’. Under the scheme, recipients will receive a one-off grant; however, how much is paid differs from state to state.
This grant can be a useful tool to help you start paying off your home loan. Depending on the type of property being purchased, when the grant is paid out might vary. Each state and territory has its own rules, but generally, the grant is paid out under the following conditions:
Again, this can vary from state to state, so it’s best to double check with your own state/territory’s revenue office if you’re unsure or with your participating lender.
Eligibility criteria for the FHOG differs across Australia. For example, in some states the property’s value cannot exceed $750,000, but in South Australia, the price cap is $575,000. Additionally, South Australia is the only state where New Zealand citizens that are Australian permanent residents could apply.
Generally speaking, the eligibility criteria is as follows:
Additionally, the property you’re purchasing must be ‘new’ under the FHOG. However, what is considered ‘new’ might vary. For example, some states list a ‘substantially renovated’ property being new, but other states don’t mention this. Generally speaking, a ‘new’ property refers to a newly-built home, off-the-plan purchase, land with a contract to build, or an owner build.
Since it’s different state to state, let’s break down how the FHOG works across the country.
To access the state’s First Home Owner Grant of $10,000 towards the purchase price, you must be buying or building your first home. This home must be brand new, meaning no one has lived in it before, and it must be worth no more than $750,000.
The state’s eligibility requirements are pretty broad. You just need to be an Australian citizen or permanent resident and be at least 18 years old to qualify.
If you’re buying or building a new home in Victoria valued up to $750,000, you could access a FHOG of $10,000. Again, the home must be brand new, and you must be a first home buyer to access the scheme.
You’re not eligible for the FHOG if you’ve received it before, or if you’ve owned a home prior to 1 July 2000. In addition, to be eligible you must be 18 years old, an Australian citizen or permanent resident, and must occupy the home for at least 12 months after settlement.
In Queensland, you can access up to $15,000 towards buying or building your new property valued at less than $750,000. You can buy off the plan or choose to build yourself. There are a few eligibility criteria to access the FHOG in Queensland; you must be:
In WA, the grant is $10,000 if you’re purchasing or building a brand new home. A home that has been substantially renovated may be considered a new home under the scheme. The home can be valued up to $750,000 south of the 26th parallel, or up to $1 million north of the 26th parallel. The grant can be accessed for the purchase of a new home, comprehensive home building contract, or owner-builder.
To be eligible for the grant, you must meet the following criteria:
You could receive up to $15,000 under the FHOG in South Australia if buying or building a new home that will be your principal place of residence. In SA, a substantially renovated home could count as a new home. The home’s value must be $575,000 or less, and there are no requirements as to how you use your grant.
You could be eligible if at least one applicant is an Australian citizen or permanent resident. New Zealand citizens permanently residing in Australia holding Special Category Visas can also apply. To apply, you must be over 18 years old; you can’t have owned or held interest in residential property in Australia prior to 1 July 2000; you can’t have received a first home owner grant anywhere in Australia; and the property must be your principal place of residence for at least six months commencing within 12 months of settlement.
Tasmania’s FHOG is between $20,000 and $30,000 depending on when you purchased your property. For transactions between 1 July 2016 and 31 March 2021, the grant is $20,000; transactions from 1 April 2021 to 30 June 2022 could be eligible for a $30,000 grant.
To be eligible, you must be over 18 years old; an Australian citizen or permanent resident; and occupy the home for at least six months. Applicants must not have owned residential property before 1 July 2000 or have received the first home owner grant before.
The FHOG in the ACT varies depending on when you purchased your property. If you purchased from 1 September 2013 to 31 December 2015, the grant amount is $12,500; if you purchased from 1 July 2016 to 31 December 2016, the grant amount is $10,000; if you purchased from 1 January 2017 to 30 June 2019, the grant amount is $7,000.
However, from June 2019, the FHOG was replaced by the Home Buyer Concession Scheme. Under this scheme, eligible home buyers pay no or reduced stamp duty. Currently, the maximum concession amount is $35,910. To be eligible, you must be 18 years old; buyers must not have owned property in the last two years; and at least one buyer must live in the home for at least one year. There are also gross income thresholds that must not be exceeded to qualify depending on the number of dependent children you have.
Unlike the FHOG, all properties are eligible for this scheme. This means that vacant land and both new and established homes fall under the Home Buyer Concession Scheme.
From May 2019, the FHOG is $10,000 to buy a new home that has never been lived in or sold as a place of residence. The eligibility criteria to apply for the FHOG in the NT is the same as the general eligibility criteria already mentioned.
If you’re looking at buying your first home, loans.com.au can help find the right home loan for you. Make sure you check out loans.com.au's competitive portfolio of fixed, variable and split rate home loans. Applying is quick and hassle-free with our 100% online application.
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