FHB Grants and Stamp Duty

Grants and Subsidy Schemes for First Home Buyers (FHB) https://oxcel.com.au/

There are several grants and subsidy schemes available for first home buyers in Australia, which vary by state and territory. These schemes are designed to help first-time home buyers enter the property market.

Here are some of the most common programs. These can and do change, due to Federal and State Government policies.

1. First Homeowner Grant (FHOG)

o Overview: A one-off grant available to first home buyers who are purchasing or building a new home. The amount and eligibility criteria vary by state and territory.

o Eligibility: You must be an Australian citizen or permanent resident, and you must not have previously owned property in Australia. The property must meet certain criteria, such as being below a certain value.

o State/Territory Variations: When looking at what is available within your State, always make sure you are looking at current schemes and not previous schemes and concessions and from the appropriate government websites.

2. First Home Loan Deposit Scheme (FHLDS)

o Overview: Allows eligible first home buyers to purchase a home with a deposit as low as 5%, without the need to pay for Lenders Mortgage Insurance (LMI).

o Eligibility: Must be an Australian citizen, at least 18 years old, and meet income and property price criteria. The property must be a residential property, and the buyer must intend to live in it.

3. First Home Super Saver Scheme (FHSSS)

o Overview: Allows first home buyers to save for a deposit within their superannuation fund, benefiting from the tax advantages of super contributions.

o Eligibility: Must be a first-time home buyer and meet specific criteria related to

contributions and withdrawals.

Refer to the website for full eligibility criteria across the different States.

The Home Guarantee Scheme (HCS) https://oxcel.com.au/

The Home Guarantee Scheme (HGS) in Australia is a government initiative designed to assist eligible home buyers in purchasing a home sooner by allowing them to buy with a smaller deposit and without the need to pay Lenders Mortgage Insurance (LMI). The scheme is administered by the National Housing Finance and Investment Corporation (NHFIC) and includes several different guarantees:

1. First Home Guarantee (FHBG)

o Overview: Helps eligible first home buyers purchase their first home with a

deposit as low as 5%.

o Eligibility:

▪ Must be an Australian citizen, at least 18 years old.

▪ Must be a first home buyer who has not previously owned property in Australia.

▪ Must meet income criteria: individuals earning up to $125,000 per annum, and couples earning up to $200,000 per annum.

▪ Property price thresholds apply, which vary depending on the location of the property.

▪ The property must be a residential property, and the buyer must intend to live in it.

2. Regional First Home Buyer Guarantee (RFHBG)

o Overview: Specifically aimed at supporting first home buyers who are purchasing in regional areas.

o Eligibility: Similar to the First Home Guarantee, but with additional focus on regional property locations.

3. Family Home Guarantee (FHG)

o Overview: Assists eligible single parents with at least one dependent child to purchase a home with a deposit as low as 2%.

o Eligibility:

▪ Must be an Australian citizen, at least 18 years old.

▪ Must be a single parent with at least one dependent child.

▪ Must meet income criteria: earning up to $125,000 per annum.

▪ Property price thresholds apply, which vary depending on the location of the property.

▪ The property must be a residential property, and the buyer must intend to live in it.

Key Features of the Home Guarantee Scheme:

• Reduced Deposit Requirements: Allows eligible buyers to purchase a home with a lower deposit (as low as 2% or 5%), without needing to pay LMI.

• Property Price Thresholds: There are maximum property price caps that vary depending on the location of the property.

• Participating Lenders: The guarantees are available through a panel of participating lenders, including major banks and smaller lenders.

Please note you will need to provide the relevant Notice of Assessment (NOA), to the Lender to validate your client’s eligibility for a HGS Guarantee.

o For reservations for a Scheme Place made by a Participating Lender on or after 1 July 2024, the 2023-24 NOA will be required. A Participating Lender can provide a 90 day expiry period whilst the NOA is being obtained however will be required prior to any Guarantee being issued and settlement occurring.

Refer to the website for specific eligibility criteria.

Stamp Duty and Websites

1. Stamp Duty Concessions and Exemptions

o Overview: Many states and territories offer concessions or exemptions on stamp

duty for first home buyers, which can significantly reduce the upfront cost of

purchasing a home.

o State/Territory Variations: When looking at what is available within your State, always make sure you are looking at current schemes and not previous schemes and concessions and from the appropriate government websites.

Stamp duty, also known as transfer duty, is a tax imposed by state and territory governments in Australia on the transfer of property. The amount of stamp duty payable can vary significantly depending on several factors and exemptions. Stamp duty is paid by the buyer, not the seller, at the time of settlement of a property purchase. Here are some key factors and common exemptions that affect the amount of stamp duty in Australia:

Factors Affecting Stamp Duty:

1. Property Value:

o The value of the property being purchased is the primary factor in determining the

amount of stamp duty. Higher property values attract higher stamp duty rates.

2. Property Type:

o Different types of properties (e.g., residential, commercial, agricultural) may have different stamp duty rates.

3. Location:

o Stamp duty rates and thresholds vary by state and territory. Each state and territory government sets its own rates and rules.

4. Buyer Status:

o First home buyers, investors, and foreign purchasers may be subject to different stamp duty rates and eligibility for exemptions or concessions.

5. Intended Use:

o The intended use of the property (e.g., primary residence, investment property,

vacation home) can impact the stamp duty payable.

Stamp duty varies State by State.

Each State has its own stamp duty rates. State by State relevant websites:

Funding Calculator

When entering in a scenario within the Infynity Funding calculator, you need to make sure that you enter in the correct information to get a proper indication of the relevant stamp duty and government costs that would apply.

You access the Funding calculator from the Calculator tab, depending on the information entered it will display the:

You can create the report and upload to the clients account, it is also recommended that you provide the report to the clients, to ensure they understand the funds they need to have available to meet the settlement.

Disclaimer: This information is current as at the time of each QRG publication. It is a general information guide only.