First Home Owner's Grant
By Dave Rawlingson and Janette Brennan
This week we will be covering a question we often hear from first home buyers and more so again with changes heading our way: “As a first home buyer how much will I receive back from the first home buyers grant (FHOG)?”
Most first time home buyers believe they will receive a higher amount back from the government than is actually true. Why? It has changed quite a few times over the years since its inception in 2000.
Originally starting off with a grant of $21,000 and undergoing multiple changes since then, currently the grant looks like this:
South of the 26th Parallel (e.g. Geraldton)
- $7,000 to the first home buyer
- The home must not exceed $750,000
- You must be an Australian citizen or permanent resident
- You must not have owned property in this country
- You must have lived in Australia for at least six months
- You must be over 18 years of age
- You must be buying or building your first property as a person, not as a company or trust
- Neither you or your spouse can have claimed this grant previously
- An eligible home must be located in Australia and be a new or established house, unit or flat
- You must live in the property for at least six months, starting within the first 12 months
But once again there are more changes heading our way on the 15th of September, once new legislation passes through parliament. The main changes are aimed at established homes and new homes:
- $7,000 reduced to $3,000 to the first home buyer
Buying New or Building
- $7,000 increased to $10,000 to the first home buyer
The government is trying to push first home buyers to build more homes to produce more “stock” for future growth. In reality, building a new home can be an expensive exercise, which is out of the reach of most first home buyers. With the median purchase price for first home buyers pushing upwards of $400,000, the offer of a further $3,000 to build is a very modest enticement in the scheme of things.
There are also a few other benefits which you may not know about under the current grant:
- With homes priced at $500,000 or less you do not pay any stamp duty as a first home buyer, which can save you up to $17,765
- REBA also offers up to $2,000 after settlement as a rebate for mortgage registration fees, solicitor and/or conveyancing fees, valuation fees, inspection fees, establishment fees, mortgage insurance premiums and lending institution fees associated with lodging the application.
What does all this mean for you, the first home buyer?
If you are thinking about buying an established home in the next month or so, maybe look at getting in before the 15th of September grant changes.
For more information log onto reiwa.com.au
For FHOG information log onto http://www.finance.wa.gov.au/cms/content.aspx?id=344
Over and out.
DISCLAIMER: We have in preparing this article used our best endeavours to ensure the information contained is true and accurate, but accept no responsibility and disclaim all liability in respect to any errors, omissions, inaccuracies or misstatements contained. Prospective purchasers should make their own enquiries to verify the information contained in this article.
David and Janette are "Team Brennan" at Ray White Geraldton. Learn more here.