FIRST HOME OWNERS GRANT: HOW TO QUALIFY FOR IT AND WHAT ARE THE BENEFITS?

The First Home Owner Grant (New Homes) was established to assist eligible first home buyers to purchase or build a new home by providing a grant of $10,000. It replaces the $15,000 First Home Owner Grant from 1 January 2016.

The grant amount is determined by the date of the transaction. Specifically, this is the date on the contract when you purchase a new home or when you start building one. For an owner builder, the eligible date is when the building work commences.

After the 1st July 2017 the FHOG cap for new home purchases is $600,000, when entering a contract to build, or if you’re an owner builder the total value cannot exceed $750,000.

To be eligible for the FHOG all the following requirements have to be met:

• the property has to be a home never previously occupied or sold, a property substantially renovated or a property built to replace a demolished one.
• the contract date must be on or after 1 January 2016
• the new owner of the property must be at least 18 years old
• the owner of the property or the spouse (including de facto spouse) must have never held a relevant interest in any residential property in Australia prior to 1 July 2000 (Note: if you or your spouse had relevant interest in any residential Australia property on or after the 1st of July 2000 you are still eligible if you didn’t reside in that property for a continuous period of at least 6 months)
• the value of the property must not exceed the First Home Owner Grant Cap of $750,000
• the owner has not received a first home owner grant in any State or Territory unless subsequently repaid
• the owner needs to live in the home for a continuous period of at least 6 months (Note: if you are part of the Australian Defence Force and all applicants are on the New South Wales electoral roll you may be eligible for exemption from this requirement)
• at least one applicant is a permanent resident or Australian citizen
• each applicant must be a natural person and not a company or trust.

FIRST HOME BUYERS STAMP DUTY: EXEMPTION/CONCESSION

If you are buying an established home as your first home and you meet the FHOG eligibility criteria, you may be entitled to a first-home buyer duty exemption (for homes valued at $650,000 or less) or concession (for homes valued at $650,001 up to $800,000). Vacant land on which you intend to build your first home is included in the scheme.

Eligible purchasers buying a vacant block of residential land to build their home on will pay no duty on vacant land valued up to $350,000, and will receive concessions on duty for vacant land valued between $350,000 and $450,000.

If not all purchasers are ‘eligible purchasers’, you may still qualify for a concession under the shared equity arrangements in First Home Buyers Assistance scheme, which allows eligible purchasers to buy property with other parties and still receives a concession. To qualify, the eligible purchasers must buy at least 50 per cent of the property. The value limits and other eligibility criteria of First Home Buyers Assistance apply. Transfer duty is calculated with reference to the proportion of the property purchased by other parties. However, this interest is disregarded if it is not more than 5%. If the first home buyer’s spouse has previously owned a home or received a benefit under First Home Buyers Assistance, the first home buyer will not be entitled to the shared equity arrangements concession under First Home Buyers Assistance, regardless of whether or not the spouse is also a purchaser.

For any other inquiries about the benefits for First Home Buyers visit the Government website http://www.revenue.nsw.gov.au/grants/fhog or give the Prosper Finance staff a call on (02) 89714756.