With a recent announcement from the Federal Government known as HomeBuilder, homeowners could substantially renovate or build a home and qualify for multiple government grants and guarantees.
For a limited time, HomeBuilder will allow current and prospective homeowners to spend up to $750,000 to build a new home or between $150,000 and $750,000 on renovating their existing home. The offer will be eligible only for applicants investing in their principle place of residence and up until 31 December 2020.
If you’re a First Home Buyer, your ears will be ringing with even better news as you may qualify for multiple government grants/guarantees if you meet the eligibility requirements.
For instance, if you are a first home buyer, in addition to the HomeBuilder Grant of $25,000, you may also be eligible for the First Home Owners’ Grant from the Queensland State Government ($15,000). Finally, when new allocations of the First Home Loan Deposit Scheme become available again from July 2020, you may be eligible for further assistance which would see you avoiding Lenders Mortgage Insurance.
We weren’t kidding when we said that you would be cheering with excitement if you were a first home buyer.
Now, there is no such thing as a free lunch. Each grant and scheme have their own eligibility requirements and we encourage you to seek further information independently. However, we have done our best to collate this information for you below.
To access HomeBuilder, owner-occupiers must meet the following eligibility criteria:
- You are a natural person (not a company or trust);
- You are aged 18 years or older;
- You are an Australian citizen;
- You meet one of the following two income caps:
- $125,000 per annum for an individual applicant based on your 2018-19 tax return or later
- $200,000 per annum for a couple based on both your 2018-19 tax returns or later;
- You enter into a building contract between 4 June 2020 and 31 December 2020 to either:
- Build a new home as a principal place of residence, where the property value does not exceed $750,000; or
- Substantially renovate your existing home as a principal place of residence, where the renovation contract is between $150,000 and $750,000, and where the value of your existing property does not exceed $1.5 million;
- Construction must commence within three months of the contract date
Queensland First Home Owners’ Grant
The Queensland First Home Owners’ Grant is a state government initiative to help first home owners get into their new first home sooner.
If your contract is dated 1 July 2018 or later and you’re eligible, you could get the Queensland grant of $15,000 towards buying or building your new house, unit or townhouse (valued at less than $750,000).
The grant is paid per new home; not to each of the applicants for the same home. The grant amount has varied since it was first introduced in 2000. Contracts dated earlier than 1 July 2018 may still be eligible for a grant. You can either choose to buy off the plan or build yourself.
To be eligible for the grant:
- You must be at least 18 years of age.
- You must be an Australian citizen or permanent resident (or applying with someone who is).
- You or your spouse must not have previously owned property in Australia that you lived in.
- You must be buying or building a brand new home.
- The value of the home including the land is less than $750,000.
- You must move into the new home as your principal place of residence within one year of the completed transactionand live there continuously for six months.
View further information on the Queensland's First Home Owner Grant here.
First Home Loan Deposit Scheme
To support you in your first home buyer journey, the Australian Government launched (as of 1 January 2020) the First Home Loan Deposit Scheme. This scheme is a government guarantee designed to help first home buyers on low and middle incomes to purchase their first home a little sooner.
Guarantees under the scheme are limited to 10,000 for each period that they are offered – the first allocation from 1 January 2020 has been exhausted but a new round of guarantees will be available from 1 July 2020. Queensland Country Bank is one of only 25 lenders nationally that are able to issue loans under the scheme.
You can check your potential eligibility on the NHFIC website. As well as income thresholds and property prices, the following conditions will generally also apply:
- Australian citizens who are at least 18 years of age. Permanent residents are not eligible
- Applicants must not have previously owned or had an interest in a residential property, either separately or jointly with someone else (this includes residential strata and company title properties, regardless of whether it was an investment or owner-occupied property and whether it was ever lived in)
- Only singles with a taxable income of up to $125,000 per annum and couples with a combined taxable income of up to $200,000 per annum may be eligible
- Couples are only eligible for the scheme if they are married or in a de facto relationship. Other persons buying together, including siblings, parent/child or friends, are not eligible
- The Scheme will only apply to Owner Occupied home loans paid on a principal and interest basis (property investment and Interest Only loans are excluded). If the loan relates both to the purchase of vacant land and then construction of a house on the land, the loan may still be an eligible loan even if the terms of the loan agreement permit Interest Only payments for a specified period
- Applicants must have a deposit of between 5% and 20% of the property’s value
- Your maximum property purchase price is subject to the suburb and postcode of your new property. You can check the property price threshold for your property’s suburb and postcode using NHFIC’s property price threshold tool
- You can only receive the Government Guarantee once
Click here to access the FHLDS fact sheet here.
If you require any further knowledge on the above, or simply wish to discuss your homeowner ideas with our team, one of our Home Loan Specialist's will be able to assist. Call our team on 1800 075 078 or contact us online here.