The schemes and grants available to help first home buyers

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Buying your first home is an exciting time! As your broker, I am here to help you every step of the way. Did you know that the Australian Government announced three new initiatives that support first home buyers? These are the First Home Loan Deposit Scheme (FHLDS), the First Home Super Saver (FHSS) scheme and the Family Home Guarantee

The biggest hurdle of first home buyers is saving enough money for a deposit. With the First Home Super Saver Scheme as a way to save for the deposit, with the First Home Loan Deposit Scheme requiring only a 5% deposit from first home buyers and with the Family Home Guarantee aimed at helping single parents at home ownership with just a 2% deposit, it has never been a good time for first home buyers to enter the market.

  1. FHLDS (New Homes) extended for 2021 to 2022

The governments FHLDS (New Homes) will be boosted by another 10,000 places. The First Home Loan Deposit Scheme was introduced in January 2020 and was extremely popular for first home buyers. As part of this scheme, the buyer only requires a 5% deposit and the government will act as guarantor for the remaining 15%. As a result, first home buyers avoid paying loan mortgage insurance. This scheme is available through Commonwealth BankNational Australia Bank and 25 other participating lenders. Interested, read our article about the First Home Loan Deposit Scheme and how it works. You will need to act quickly with almost all spots secured after becoming available.

  1. First Home Super Saver Scheme (FHSSS)

This scheme was introduced in the Federal Budget in 2017, but has been expanded too allow first home buyers to release up to $50,000 from their superannuation, up from the previous $30,000. This scheme allows eligible first home buyers to dip into their Superannuation to withdraw up to $50,000 to use as a deposit towards an owner occupied purchase. The increase will take effect from 1st July 2022. The scheme allows first home buyers to make voluntary contributions to their super either before or after tax and use these savings towards their deposit.

For most first home buyers, the First Home Super Saver Scheme could boost your savings up to 30% faster, compared with saving through a standard deposit account. This is due to the concessional tax treatment and the higher rate of earnings often realised within superannuation.  You can read more about the First Home Super Saver Scheme here.

  1. Family Home Guarantee/ No Deposit Home Loan

This “guarantee” is aimed at helping single parents into home ownership. The guarantee enables eligible single parents to be able to build or buy a new home with only 2% deposit. You will need to be able to service the loan to be eligible. Places will start to become available from July 1, 2021. However, only 10,000 places will be available over 4 years nationally. So you will need to act quickly for this also.

Yes, it can be tough to get a foot on the property ladder, but first home buyers should not be deterred. About a third of millennials and a quarter of all Australians plan to buy a property in the next two years with many using the
lockdowns in 2020 to up the ante on their savings. There is no better time than now for First Home Buyers to dive in and make that commitment – if possible. 

There are also First Home Owners Grant available in every state and territories and stamp duty exemptions for first home buyers. In NSW, first home buyers can qualify for the $10,000 FHOG if they purchase a new property for $600,000 or buy land and build a home for $750,000. 

The First Home Buyers Assistance scheme provides first home buyers an exemption from transfer duty on new homes valued at less than $650,000 and concessions for new homes valued between $650,000 and $800,000. No duty is payable by eligible purchasers buying a vacant block of residential land valued at up to $350,000, while concessions are available for vacant land purchased for between $350,000 and $450,000. 

At Maverick Finance, we have seven FHLDS participating lenders in our panel. We have two major lenders – NAB and CBA and non-major lenders – Auswide, MyState, Teachers Mutual Bank, Firefighters Mutual Bank and Health Professionals Bank.  Contacting a mortgage broker early in your search is often a wise idea as it may allow the broker time to understand your circumstances and potentially help prepare you for a successful loan application when the time is right. 

 

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We are a team of qualified professionals who have been in the mortgage broking industry for the last 10 years. We are also property investors who have accrued the knowledge and experience to help you achieve your property goals.

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