Market Proves Favourable for First Home Buyers

All indicators point that the market is good for first home buyers to participate. At no other time in history has there been as great an access to cash subsidies and savings from government initiatives that encourage first home buyer activity in today’s market.

Government Grants Available to First Home Buyers

The Federal Government initiated several programmes as incentive to lure first home buyers to the housing market as incentive to improve construction activity in the new home market. Additionally, state governments have also introduced incentive programs including NSW’s New Home Buyers supplement that was enacted and introduced in November 2008. An NSW first home buyer receives a $3,000 supplement. This can be received along with the existing $7,000 grant that eligible applicants receive from the First Home Owner Grant programme. Originally, the $3,000 supplement was available through November 2009. However, the NSW state government announced in May 2009 that the programme would extend to June 2010. Furthermore, these incentives are also available along with the $14,000 provided through the Commonwealth’s First Home Owner Boost Scheme.

First Home Buyer Eligibility

There are several criteria that need to be met for obtaining First Home Buyer grants and supplements including:

• Applications need to be submitted within 12 months of construction completion
• Applicants must be individual first time property buyers, not a company or a trust
• Applicant or spouse/co-buyer must not have previously owned any interest in any land that had a residence on it before July 1, 2000.
• Applicant or spouse/co-buyer cannot own or occupy a residence after July 1, 2000
• Ownership in investment properties after July 1, 2000 without ownership before this date may be allowed as long as the property was not a personal residence
• No applicant can apply for a second grant
• Eligible property must be located in Australia. It must be a new or established house, flat, or other self-contained dwelling that qualifies as a residence.
• Building of a dwelling must have taken place after July 1, 2000
• Eligible property has to be the applicant and spouse/co-buyer’s principal residence. Minimum residence periods are detailed by each territory or state.
• Joint applicants can only apply for one single grant for 0one property receiving one $7,000 payment

Stamp Concessions Available

Additionally, eligible applicants for the above mentioned grants and subsidies may also qualify for concessions concerning a variety of stamp duty costs face by first home buyers. Stamp duty costs are typically payable in all states. However, first home buyers may not only qualify for concessions, but some states offer exemptions on some or all of the following fees:

• Transfer Stamp – is payable to the homeowner’s state and is based on the purchase price. This fee is typically due within three months from the execution and exchange of contracts.
• Mortgage Stamp – also is payable to the homeowner’s state  based on the amount of mortgage funding secured and;
• Mortgage Registration – is payable whenever a mortgage is established against a property or is fully discharged.

With these grant, subsidy and fee waiver programmes, now is a great time for any first home buyer to consider a new purchase.