What is the First Home Owner Grant?

What is the First Home Owner Grant?
With home loans, stamp duty, inspections and conveyancing, the costs of buying your first home can add up. The First Home Owner Grant is an initiative provided by State Governments nationwide designed to get you into your new home sooner.
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Building or buying your first home? It can be an exciting yet expensive feat, with home loans, stamp duty, inspections and conveyancing costs all adding up. The First Home Owner Grant is an initiative provided by State Governments nationwide designed to get you into your new home sooner.

What is the First Home Owner Grant?

Launched in 2000, the First Home Owner Grant (FHOG) is a tax-free, lump sum of cash provided to first home buyers on behalf of State Governments to alleviate some of the financial pressure that comes from buying your first home.

The FHOG is provided to first home buyers purchasing a new home that has not previously been lived in or first home buyers purchasing vacant land to build a new home upon.

First home owners are entitled to receive their grant at different stages in the buying and building journey. For those buying a new home that is already built, the grant is typically paid at the time of settlement to your mortgage lender so it can be directly deducted from your home loan.

When building your house with a construction loan, the grant will be approved once your first mortgage repayment is due.

Can I use the FHOG to cover my new home deposit?

The FHOG can be used as part of your deposit for your first home buyer loan, however you will also need to have existing savings as the FHOG alone will not meet lending deposit requirements.

How do you apply?

To receive the FHOG, you can apply directly to the Government revenue office in your relevant State or Territory. Alternatively, you can lodge your FHOG application through your lender at the same time as your home loan application.

Depending on which State or Territory you call home, the process to apply for the FHOG will be slightly different. Generally for the application, you’ll need to lodge:

  • documents that confirm your identity and your eligibility; and 

  • a copy of the contract of sale or contract to build if you’re constructing a new home.

Related: Home loan application checklist

Are you eligible for the First Home Owner Grant?

Each state and territory has its own conditions but there are some common requirements for utilising the FHOG.

To be eligible, you must:

  • Be aged 18 years or over;

  • Be a permanent resident or Australian citizen;

  • Plan to live in the property as your home for at least six months and

  • Have never previously owned your own home in Australia.   

What is classified as a new home?

To receive the FHOG, a new home is classified as a house, apartment, unit, townhouse or off-the-plan home that has never been occupied as a place of residence or sold as a place of residence.

Substantially renovated homes completed by the seller in limited circumstances may also eligible for the FHOG, however guidelines vary across States and Territories.

Investment properties are not classified as a new home, therefore are ineligible to receive the FHOG.

State by state guide

The following information outlines the FHOG available to Australian residents for each State and Territory.

Queensland

First home owners in QLD are eligible to receive a grant of $15,000 towards buying or building a new home.

To meet eligibility criteria, you must be buying or building a new house, unit or townhouse, valued under $750,000. You must move into your new home within one year of purchase and reside there as your principal place of residence for a continuous period of a minimum six months.

If you have to move out during this time, the government may request that you pay back the grant.

New South Wales

First home owners in NSW can receive a grant of $10,000 towards buying or building a new home.

The NSW FHOG gives first home owners a maximum of $10,000, as long as they are buying a new home valued at $600,000 or less, or building a new home valued up to $750,000.

NSW doesn’t offer a FHOG for established properties, however it offers first home buyers full stamp duty exemption on new and existing properties valued up to $800,000, and concessional rates for properties valued under $1,000,000.

Victoria

First home owners in VIC can receive a grant of $10,000 towards buying or building a new home up to the value of $750,000.

There are further concessions available if the home is your principal place of residence, if you are a pensioner, off-the-plan buyer or a first home buyer with a family.

Western Australia

First home owners in WA can receive a grant of $10,000 towards buying or building a new home.

In Western Australia, the FHOG will vary depending on the location of your new purchase or build.

An initial grant of $10,000 applies when you buy or build a new home with value thresholds of $750,000 south of latitude 26 (including Perth), and $1,000,000 north of this level.

South Australia

First home owners in SA can receive a grant of $15,000 towards buying or building a new home.

The market value ceiling for claiming the FHOG in South Australia is $575,000 – a figure that applies to the value of a construction after it is completed.

Tasmania

First home buyers in TAS can receive a grant of $30,000 for transactions that commence between 1 April 2021 and 30 June 2022.

Tasmania doesn’t offer a FHOG for established properties, but it offers a 50 per cent discount on stamp duty to first home buyers of established properties valued up to $400,000.

Australian Capital Territory

In the ACT, the First Home Owner Grant has been replaced by the Home Buyer Concession Scheme, which offers concessions on stamp duty.

Eligible home owners under a certain income threshold who have not owned any other property in the last two years and plan on living in the home continuously for at least one year within 12 months of the settlement date, may be eligible to pay no duty or reduced duty on their home purchase.

Northern Territory

If you are buying or building a new home in the NT, you can apply for the territory’s first home owner grant of $10,000.

Buying your first home?

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