First home buyer grants and schemes for Australians
As a first home buyer in Australia, navigating the property market can be a daunting experience. However, the government offers various grants and schemes designed to ease the financial burden and make home ownership more accessible. By leveraging these opportunities, first home buyers can significantly reduce their upfront costs, secure more favourable loan terms, and expedite their journey towards owning a home. Understanding and utilising these government initiatives can provide substantial financial relief and make the dream of home ownership a reality!
First Home Owner Grant
What is it?
A grant of $10,000 is available for First Home Buyers when you buy or build your first home up to the value of $750,000 or less. A new home build can include a home that has been significantly renovated or knocked down and a new one rebuilt.
The First Home Owner Grant can be used in conjunction with other Schemes or Concessions for eligible First Home Buyers.
Eligibility
To be eligible for the FHOG you must:
- Be aged 18 or over
- Be an Australian citizen or permanent resident
- Occupy the property for at least 12 months from the date of settlement for purchases, or the date the construction of the home is finished
You can utilise the State Revenue Office’s online tool to determine your eligibility.
First Home Guarantee (FHBG)
What is it?
The First Home Guarantee is available for First Home Buyers to enter the housing market with a minimum deposit of 5% with no LMI to purchase a residential property. A residential property includes:
- An existing house, townhouse, or apartment
- A house and land package
- An off-the plan apartment or townhouse
- A land and separate contract to buy a house
35,000 places are available for the First Home Guarantee and 10,000 for the Regional First Home Buyer Guarantee. The First Home Guarantee can be used in conjunction with other Schemes or Concessions for eligible First Home Buyers.
Eligibility
To be eligible for the FHBG you must:
- Be aged 18 or over
- Be an Australian citizen or permanent resident
- Have an individual taxable income of no more than $125,000, or a joint taxable income of no more than $200,000 for the previous financial year (as shown on your Notice of Assessment which is provided by the Australian Tax Office)
- Contribute between 5% - 20% of the value of the property as a deposit
- Have not owned a property in the past 10 years
- Intend to be an owner-occupier of the property as investment properties are not included
In addition, the FHBG has property price caps to be eligible to receive benefits, these include:
First Home Guarantee and Family Home Guarantee Property Price Cap Table
Regional First Home Buyer Guarantee Property Price Cap Table
Family Home Guarantee (FHG)
What is it?
The Family Home Guarantee is available for single parents or single legal guardians with at least one dependent that is a First Home Buyer or previous homeowner to enter the housing market with a minimum deposit of 2% with no LMI to purchase a residential property. A residential property includes:
- An existing house, townhouse, or apartment
- A house and land package
- An off-the plan apartment or townhouse
- A land and separate contract to buy a house
5,000 places are available, and the Family Home Guarantee can be used in conjunction with other Schemes or Concessions for eligible First Home Buyers.
Eligibility
To be eligible for the FHG you must:
- Be aged 18 or over
- Be an Australian citizen or permanent resident
- Apply as an individual
- Have an individual taxable income of no more than $125,000 for the previous financial year (as shown on your Notice of Assessment which is provided by the Australian Tax Office)
- Contribute between 2% - 20% of the value of the property as a deposit
- Have not owned a property in the past 10 years
- Intend to bean owner-occupier of the property
To be an eligible single parent or legal guardian you must:
- Not have a spouse,de-facto partner, or be separated (but not divorced)
- Have at least one dependent that they are the natural parent, adoptive parent, or legal guardian of
- Demonstrate legal responsibility for the day-to-day care and welfare of the dependent
In addition,the FHG has the same property price caps as First Home Guarantee to be eligible for the benefits.
First Home Buyer Stamp Duty Exemption / Concession
What is it?
The First Home Buyer Stamp Duty Exemption / Concession is available for First Home Buyers to waive stamp duty costs for properties purchased with a value of $600,000 or less; or to reduce stamp duty costs for the properties purchased between $600,001- $750,000.
If you fall within the stamp duty concession bracket, you can find out your required stamp duty payments with this calculator.
Eligibility
To be eligible for the First Home Buyer Stamp Duty Exemption or Concession you must:
- Purchase a property with a value of $600,000 or less to receive the stamp duty exemption
- Purchase a property with a value between $600,001 - $750,000 to receive the stamp duty concession
- Meet the eligibility requirements of the First Home Owner Grant
- Have not received the exemption or concession previously, this includes if your partner has previously received it
First Home Super Saver Scheme
What is it?
The First Home Super Saver Scheme allows you to make voluntary contributions (both before-tax concessional and after-tax non-concessional) into your nominated super fund to save for your first home. You can contribute up to $15,000 each financial year up to a total of $50,000 across multiple years.
Eligibility
To be eligible to utilise the FHSS you must meet all the following conditions:
- Be a First Home Buyer
- Be aged 18 or over when requesting a FHSS determination; however, you can make contributions to your super fund before you are aged 18 or over.
- Have your name on the title of the purchased property
- Have not previously requested a FHSS release of funds
Who can contribute?
Contributions can be made through a salary-sacrifice arrangement with your employer, personal tax-deductible contributions, or non-concessional contributions.
Ineligible contributions include:
- Mandated super contributions made by your employer
- Government co-contributions
- Contributions made by a spouse, parent, friends or family
- Excess contributions made above the contribution cap
To see additional ineligible contributions, visit: https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/withdrawing-and-using-your-super/early-access-to-super/first-home-super-saver-scheme#ato-Eligibility
Pros
- Tax savings on contributions and withdrawals
- Potential for faster savings growth
- Encourages disciplined savings
- Couples can save more together
- Can make both pre-tax and post-tax contributions
Cons
- Capped contributions and withdrawals of $50,000
- Market volatility can affect returns
- Complexity in managing tax and super rules
- Long processing times for withdrawals
- Money remains in super if plans change
Help to Buy Scheme
What is it?
The Help to Buy Scheme is a shared equity scheme (introduced in 2024) where the Australian government helps first-time home buyers purchase a property by contributing up to 40% for a new home or 30% for an existing home. Buyers only need to come up with a minimum 2% deposit, and the government becomes a co-owner of the property proportionate to its contribution. The homeowner doesn't have to pay rent on the portion the government owns, but they will have to buy out the government's share when they sell the house or if they want to fully own it.
This program aims to make homeownership more accessible by reducing the loan size and associated mortgage repayments.
Eligibility
To be eligible to utilise the Help to Buy Scheme you must meet all the following conditions:
- Be a First Home Buyer
- Be aged 18 or over
- Be an Australian citizen or permanent resident
- Have an individual taxable income of no more than $90,000 or $120,000 for couples
- Contribute a minimum of 2% of the property as a deposit
- Intend to bean owner-occupier of the property
Key considerations
- Buying out the government share: If the homeowner’s financial situation improves, they can choose to gradually buy out the government’s share. This would likely be done at the market value at the time of repayment
- Sale of the property: When the property is sold, the government’s contribution is repaid based on the sale price
This scheme helps first-time buyers by lowering borrowing costs, but it’s essential to be aware of the implications of the government holding equity in the property.
Approved lenders
It’s important to note that not all lenders participate in offering Home Guarantee Schemes to home buyers. Major lenders that do participate include:
- Commonwealth Bank
- NAB
- Westpac
- Bank of South Australia
- Bank of Melbourne
- St George
To see a complete list of non-major lenders,refer to https://www.housingaustralia.gov.au/participating-lenders.
