Home Buying First Home Owner Grant – Let’s Explore Now

First Home Owner Grant – Let’s Explore Now

by Novruz Gadirzade
First Home Owner Grant

The Australian government provides many incentives to first home buyers including first home owner grant. It promotes homeownership, and the mechanism also works as a stimulus in the economy. Therefore, all territories have a certain fixed grant for the first home owners.

What is First Home Owner Grant?

In a nutshell, the First Home Owner Grant (FHOG) is simply a monetary grant available for individuals who are buying first home. It is eligible for people who are either building their new house or are shifting to a place that has never been resided before. The grant encourages new home constructions and helps the first home buyers to get on the property ladder.

The first home owners grant amount is free, and the first home buyers do not have to repay it. Besides, it’s not taxable either. However, there are few strings attached that need to be considered when opting for the grant.

How Much Is The First Home Owner’s Grant? 

The First Home Owner Grant is a national scheme subsidized and managed by each of the states and territories under their legislature. Hence, the amount of the grant varies from one state to another.

So, the exact amount that one can receive for their first home depends on where the property is bought. For example, the FHOG is worth $15,000 in Queensland. 

Who Is Eligible For The First Home Owner Grant?

The guidelines for the First Home Owner Grant vary marginally around Australia; however, some essential conditions apply:

  • You should be a permanent inhabitant or an Australian resident to qualify for the first home buyers grant. Moreover, in case you’re co-purchasing with somebody, then at least one of you must be a permanent inhabitant or Australian resident.
  • You should not have possessed or co-claimed a home in Australia previously or have gotten an Australian First Home Owner Grant before.
  • You should purchase a home to live in. It should not be used as a speculation property.
  • You have to live in the home for at least half a year after the purchase.
  • You should be a characteristic individual. An organization, trust, or company is not eligible to apply for the First Home Owner Grant.
  • You should be about or over 18 years.

Different conditions may apply contingent upon your state/an area. In numerous states, the first home owner grant is just accessible if you purchase or build a home. In certain states, you may not be qualified for the FHOG if you pay over a specific incentive for your first home.

As each state has its arrangement of rules for the First Home Owner Grant, it is imperative to comprehend the rules that apply to your region.

Can A First Home Owner Grant Be Used As A Deposit? 

Indeed! The entire motivation behind the First Home Owner Grant is to assist you with dealing with the expenses of claiming a home; however, it may not be sufficient to shape your entire deposit.

  • Your application for the first time home buyers grant normally just takes possibly 14 days to be prepared, but when you get the grant precisely, relies upon whether you are purchasing or building.
  • In case you are purchasing a house that is now assembled, you are most likely to get the assets when the property settles. This means on the stage when all the desk work is finished, and the keys to your house are given over to you.
  • In case you are constructing your home, the first home grant is normally paid when you first drawdown your credit, and that is normally when the base has been laid.

How Can You Apply For The First Home Owner Grant?

The application process for the first home buyer grant is quite simple and easy to follow through. You can commence by filling out the form here.

Essentially, you can apply for the First Home Owner Grant through two methods.

  • The first one is through a lender. You can apply for the grant when you are applying for the home loan. This way, your broker can help you out.
  • The other method is direct. You can directly approach and apply it to your state government body. The revenue office generally entertains this domain and caters to the first home owners grant.

Are First Home Buyers Exempt From Stamp Duty? 

First home buyer stamp duty exemption is not certain and depends on the state. A few states offer liberal investment funds on stamp obligation for first property holders. Others don’t offer concessions on first home buyer stamp duty by any means. In various states, saving money on stamp duty is just accessible if you purchase or construct a new home.

This makes it imperative to realize whether stamp investment funds are accessible to initially home purchasers in your region of Australia. Do keep in mind that stamp obligation can be costly. Hence, you may need to add the expense to your home purchasing financial plan.

How First Home Owner Grant Works – State By State? 

Here is an overview of how the First Home Owner Grant works in different states. It includes the estimated amount granted, concessions and exemptions, and other information that might be helpful.

In Queensland 

Estimated Amount: $15,000

What can you use first home owners grant QLD for? 

  • Building or buying a new house valued up to $750,000.

Other concessions or exemptions: Stamp obligation concessions are accessible for first home purchasers of properties esteemed up to $550,000. These sums change depending upon the price tag.

For more information on first home owners grant QLD, visit: Queensland Government.

In Victoria 

Estimated amount: $10,000 for urban homes and $20,000 for homes in regional Victoria 

What can you use first home owners grant VIC for? 

  • A brand new house valued up to $750,000.

Other concessions or exemptions: First home purchasers in Victoria are additionally excluded from paying stamp obligation on properties esteemed up to $600,000. In contrast, a concession is accessible for properties esteemed somewhere in the range of $600,001 and $750,000.

For more information on first home buyers grant victoria, visit: State Revenue Office Victoria.

In New South Whales

Estimated Amount: $10,000

What can you use first home owners grant NSW for? 

  • A new house with a value of up to $600,000.
  • A new house with a value of up to $750,000 if you are an owner-builder or enter a contract to build.

Other concessions or exemptions: From August 1, 2020, first home purchasers in NSW are excluded from paying exchange obligation on new homes esteemed under $800,000 and existing homes esteemed under $650,000. Move obligation concessions apply to initially home purchasers of new homes esteemed from $800,000 up to $1m, and existing homes esteemed somewhere in the range of $650,000 and $800,000.

For first home purchasers who buy empty land on which they intend to assemble a home, no exchange obligation applies on empty land esteemed under $400,000. Concessional rates apply ashore esteemed $400,000-$500,000.

For more information on first home owners grant NSW, visit: Office of State Revenue New South Wales.

In Western Australia 

Estimated Amount: $10,000

What can you use first home owners grant WA for?

  • Buy new homes with a value of up to $750,000 south of the 26th parallel.
  • Buy new homes with a value of up to $1m for new homes purchased north of the 26th parallel.

Other concessions or exemptions: Stamp obligation concessions are accessible for first home purchasers of properties esteemed up to $530,000. These sums fluctuate contingent upon the price tag.

For more information on first home owners grant WA, visit: Government of Western Australia.

In South Australia 

Estimated Amount: Up to $15,000

What can you use first home owners grant SA for?

  • Buy new homes with a value of up to $575,000 (if the property is planned as your principal place of residence (PPR) and you intend to live there for six months, within a year of settlement).

For more information on first home owners grant SA, visit: Government of South Australia.

In Tasmania 

Estimated Amount: $20,000

What can you use it for?

  • New homes or off-the-plan properties only.

Other exemptions or concessions: 50% discount on property transfer duty for first home buyers of established homes with a dutiable value of $400,000 or less.

For more information on the subject, visit Tasmania Government.

In Northern Territory

Estimated Amount: $10,000

What can you use it for?

  • New homes only.

Other exemptions or concessions: There is a scope of government awards, concessions, and refunds accessible for first home purchasers and other Northern Territory home purchasers.

For more information on the subject, visit the Northern Territory Government.

In Australian Capital Territory

The First Home Owners Grant ACT has been supplanted by the Home Buyer Concession Scheme, which gives a full stamp obligation concession for qualified candidates.

For more information on the subject, visit the ACT Revenue Office.

Final Words

There are many incentives available for first homeowners in Australia.  We hope this article has proved to be helpful in understanding the grant and its procedure. For further information on First Home Owner Grant consult your state government body. 

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