With so many Government incentives around for first home buyers at the moment and interest rates at an all time low, I thought it would be a great idea to write a couple of newsletters outlining how these incentives might benefit you or someone you know depending on the type of property you are looking to purchase.
In this update I will be providing some detail around a house and land package in Alfredton which is a suburb of Ballarat in Victoria. The total fixed cost is $541,476 which includes a 4 bedroom and 2 bathroom home on a 577m2 block.
Because this will be a brand new house and you will have a contract inclusive of the construction, you could be eligible for a number of Government incentives of which I have listed below.
First Home Owner Grant (FHOG)
If the house you are purchasing or building is brand new and the value of the house is up to $750,000, you could be eligible for the First Home Owner Grant (FHOG) valued at either $10,000 or $20,000 depending on the region you live in. Because this example is in Ballarat and it is in regional Victoria you could be eligible for a $20,000 FHOG.
Stamp Duty Exemption
Unlike the FHOG, stamp duty exemptions relate to both established and new homes so if the house you are purchasing is $600,000 or less you could be eligible for a full stamp duty exemption. From $601,000 to $750,000 you could be eligible for a stamp duty concession. The closer the purchase price gets to $750,000 the less you will save. You can find out more here – https://www.e-business.sro.vic.gov.au/calculators/land-transfer-duty.
The HomeBuilder Grant is something the Australian Government has introduced during COVID-19. It is a one-off payment of $25,000 to those eligible owner-occupiers who are building a new home or substantially renovating an existing home. Because this grant has only recently been introduced, the finer details of how it will work are still to be confirmed.
It is important to understand the eligibility criteria for this grant before assuming you are eligible. To find out more about the eligibility criteria you can head here to download the fact sheet – https://treasury.gov.au/coronavirus/homebuilder.
First Home Loan Deposit Scheme
The First Home Loan Deposit Scheme in simple terms means the Australian Government will provide a guarantee for eligible first home buyers who have a 5% deposit so they do not have to pay lenders mortgage insurance. To find out more you can head to https://cherrylending.com.au/the-first-home-loan-deposit-scheme/.
So, as you can see based on this example there could be quite a few Government incentives available to those eligible first home buyers. Each incentive has a different eligibility criteria so if you need assistance working out if you are eligible you can call Nikki from Cherry Lending & Finance on 0427 374 155.
If you are looking to purchase an established home and missed my last blog, head to https://cherrylending.com.au/first-home-buyer-case-study-established-home-in-victoria/ to read more.
This page /newsletter provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances.