Do you have a question about the NSW First Home Buyers Grant?
What is the First Home Owner Grant?
The First Home Owner Grant is a lump sum of cash available to first home owners to help with the cost of buying a first home or vacant land to build a home on. The Grant doesn’t have to be repaid, and it’s not taxable, but there are strings attached. Here’s what you need to know about the First Home Owner Grant. (After this you may want to check out First Home Buyers Checklist).
How much is the First Home Owner’s Grant in NSW?
The FHOG in NSW is worth $10,000 however conditions apply. To be eligible, your first home must have a total value below $600,000, and be either newly constructed or ‘substantially renovated’. A home is substantially renovated when most or all of the original house was removed or replaced, and it’s the first time the place has been sold, and lived in, after the renovations were completed.
If you plan to build a new home from scratch, you can still be eligible for the FHOG in NSW as long as your land plus the home you build have a combined value of less than $750,000.
Am I eligible for the First Home Owner Grant?
The rules for the First Home Owner Grant differ slightly around Australia but some basic conditions
You must be a permanent resident or an Australian citizen. If you’re co-buying with someone
else, at least one of you must be a permanent resident or Australian citizen
You must not previously have owned or co-owned a home in Australia or have received an
Australian First Home Owner Grant in the past.
You must be buying a home to live in – not as an investment property
You need to live in the home for at least six months after purchase,
You must be a natural person (not a company or a trust), and
You need to be aged over 18.
Other conditions may apply depending on your state/territory. In many states, the First Home Owner Grant is only available if you buy or build a new home. In some states, you may not be eligible for the FHOG if you pay over a certain value for your first home.
As each state has its own set of rules for the First Home Owner Grant, it is important to understand the
guidelines that apply for your area.
Can the First Home Owner Grant be used as a deposit?
Yes! The whole purpose of the First Home Owner Grant is to help you manage the costs of owning a home, though it may not be enough to form your whole deposit.
Your application for the First Home Owner Grant usually only takes a week or two to be processed, however exactly when you receive the Grant depends on whether you are buying or building.
If you’re buying a home that’s already built, you’ll usually receive the funds when the property settles – that’s the stage when all the paperwork is completed and the keys to your home are handed over to you.
If you’re building a new home, the First Home Owner Grant is usually paid when you first drawdown your loan – and that’s typically when the slab is laid.
How can I apply for the First Home Owner Grant?
Applying for the First Home Owner Grant is easy, Sean and Claire from Mortgage Choice at Oatley can guide you through the paperwork.
Basically, there are two ways to apply for the First Home Owner Grant. You can apply through your lender at the same time you apply for your home loan – this is where Sean and Claire of Mortgage Choice at Oatley can help. Or you can apply directly to the NSW state government via the Office of State Revenue, who handle the First Home Owner Grant in NSW.
What is stamp duty?
Stamp duty is one of the upfront costs that apply when you buy a home or vacant land. It is a type of state government tax, so the rates of duty differ between states. The common thread is that stamp duty is calculated as a percentage of the price paid for your home.
Put simply, the amount of stamp duty you will pay depends on where you are buying, and how much you pay for your home or vacant land.
Are first home buyers exempt for stamp duty in NSW?
Great news for first home buyers in NSW. Under the First Home Buyer Assistance scheme, savings on stamp duty are available to first home owners no matter whether you buy a new or established home.
How much you save on stamp duty depends on the price you pay for your home.
First home owners in NSW pay no stamp duty at all when you buy a property valued below $650,000. That’s a saving of $24,740. You can still be entitled to savings on stamp duty even if you pay between $650,000 and $800,000 for your first home. The cost of duty rises on a sliding scale. For example, if you pay $700,000, you’ll pay stamp duty of $10,490 – a saving of $16,500. If your first home costs $795,000, the stamp duty cost will be $30,440, providing a saving of $825.
Stamp duty savings for first home owners
|Purchase Price||First Home - New Home Duty|
$650,000 - $700,000
$0 - $10,490
$710,000 - $750,000
$12,590 - $20,990
$760,000 - $790,000
$23,090 - $29,390