The phone has been running hot with Newcastle and Lake Macquarie first homebuyer enquiries since the O’Farrell Government handed down the budget in early June. There seems to be confusion surrounding the “think new” incentives so I thought it worthwhile summarising what the incentives are.
First homebuyers purchasing newly built properties
- From the 1st October this year the First Home Owner Grant will increase from $7,000 to $15,000 on newly built or off the plan properties, with a value of up to $650,000. The grant will remain in place until 31 December 2013, but from 1 January 2014, it will drop back to $10,000.
- First home buyers will be exempt from stamp duty if they purchase a newly built home with a value of up to $500,000 ($550,000 from 1 July 2012) and will receive a stamp duty concession for a newly built home valued between $500,000 and $600,000 ($550,000 and $650,000 from 1 July 2012).
- Those purchasing a vacant block of residential land to build their home on will pay no duty on vacant land valued up to $300,000 ($350,000 from 1 July 2012) and will receive a concession on duty for vacant land valued between $300,000 ($350,000 from 1 July 2012) and $450,000.
Whilst this is all great news for buyers of newly built homes or even vacant land, there is little help in sight for the majority of the market who are looking at purchasing existing properties.
First homebuyers purchasing existing properties
- The current First Home Owner Grant of $7,000 for an existing property will be axed from 1 October, with major flow on effects expected to be felt by real estate agents and the property market in general. First homebuyers purchasing existing properties after 1 October will also miss out on stamp duty concessions, which can be costly. My tip for buyers considering purchasing an existing property is to get their finances in shape now and to investigate whether or not they’re in a good position to purchase before October.
First homebuyers are not the only ones to experience changes
- Even if you are not a first homebuyer, the Government will from July onwards give you $5,000 if you purchase a newly built or off the plan property valued up to $650,000 or vacant land that you intend to build on that has a value up to $450,000. However, this bonus replaces the NSW Home Builders Bonus, which provides investors, subsequent homebuyers and seniors with stamp duty exemptions or concessions for certain purchases of newly constructed property, off the plan property and vacant land on which to build property.
While the Treasurer acknowledged that axing help for some first homebuyers was a difficult decision, he felt that the changes will help kick start the struggling building industry by “targeting assistance where it is most needed in the economy”.
For more information contact Richard Windeyer on 1800 01 LOAN or click here to "Book a Meeting"