1st Home Buyers
Buying a first home can be one of the most exciting events in a person’s life. It is also usually the most expensive, at least until that second home purchase!
First home buyers can be caught by surprise at the upfront costs of purchasing a home. Of course, most buyers are acutely aware of the need to save a deposit, often 20% of the purchase price. But these buyers are often less aware of the need to have enough cash to pay for building and pest inspections, conveyancing fees, and transfer and stamp duties.
These additional fees can be significant, especially the stamp duty, which on an average-price home in New South Wales is $40,000.
Fortunately, there are grants and concessions available to help buyers get into their first homes in New South Wales. It is always up to the buyer to identify these benefits and apply, so it is important to understand what benefits are available. The following benefits are currently available to first home buyers in New South Wales.
First Home Buyer Assistance Scheme (FHBAS)
First home buyers in New South Wales can apply for an exemption or reduction of duty charges under the First Home Buyer Assistance Scheme (FHBAS). Importantly, the FHBAS applies to existing homes, as well as new homes and vacant land on which to build a home.
Under the FHBAS, buyers purchasing their first home in New South Wales for less than $800,000 can receive a partial or full exemption on duty. Whether a full or partial exemption applies is based on the purchase price and whether the property is an existing or new home.
For first home buyers who still have some duty to pay, there is a new scheme that will allow them to elect to either pay the stamp duty upfront in one lump sum or choose to pay the duty in an annual property tax. This scheme is not applicable to properties with a purchase price over $1.5 million (or $800,000 for vacant land).
Eligibility for FHBAS
The FHBAS scheme is only for buyers who have never previously owned a property. In addition, a buyer’s spouse must also be a first home buyer.
Buyers must be Australian citizens (or permanent residents), over eighteen, and must be individuals (that is, not a company or other legal entity). Buyers must also move into the property within a year, and live in the home for at least six months.
To apply for the scheme, buyers must have already exchanged contracts to purchase their first home or vacant land. The application form and supporting documents is lodged with the buyer’s conveyancer.
First Home Owner’s Grant for New Homes
First home buyers who choose to buy a new build home, or who will be building their own home, may be eligible for an additional benefit. Revenue NSW manages a scheme that allocates grants of $10,000 under the First Home Owner’s Grant for New Homes.
Most buyers apply for the First Home Owner Grant at the same time as they apply for their home loan. Banks and financial institutions often take the grant into consideration when calculating required deposits.
We provide quality conveyancing services and advice delivered in plain language. We understand from “both sides of the fence” how stressful buying and selling a property can be and will make your conveyancing transaction as transparent and stress-free as possible. We provide a full and thorough explanation of your contract or documents before you sign them and will answer all your questions, complex or otherwise. No question is too difficult or too trivial.
If you need any assistance, contact [email protected] or call 02 9481 7000 for expert conveyancing and property services.