The First Home Owner Grant: what is it, and who can get it?
Wed Feb 15 14:29:00 AEDT 2017
The First Home Owner Grant (FHOG) is a national scheme that was introduced in 2000 to compensate first home buyers for the extra costs the GST imposed on buying property.
The FHOG is only available for the purchase or construction of new dwellings, not existing ones. While it’s a national scheme, the grants are administered by the states and territories; as such, different conditions apply from one state or territory to another.
How much is the grant?
The grant varies depending on which state or territory you’re buying your home in and may be subject to various conditions. The amounts for eligible transactions as of February 2017 are:
Australian Capital Territory – $7,000
New South Wales – $10,000
Northern Territory – $26,000
Queensland – $20,000
South Australia – $15,000
Tasmania – $20,000 until 1 July 2017, when it will revert to $10,000
Victoria – $10,000
Western Australia – $10,000, plus a $5,000 booster payment for purchases from 1 January to 31 December 2017
In addition to the FHOG, the states and territories may offer stamp duty concessions or exemptions.
Who can get the grant?
To be eligible for the FHOG you must be at least 18 years of age and be an actual person (i.e. not a trust or corporation).
One of the purchasers must be an Australian citizen or permanent resident. The grant is only available to people buying or building their first residential property. Also keep in mind that eligibility may differ state by state.
Who can’t get the FHOG?
If you (or your partner/spouse) owned a residential property before 1 July 2000, you’re not eligible for the FHOG. If you owned a residential property after 1 July 2000 that you lived in for a period of at least six months, you’re not eligible. In Queensland you’re not eligible if you have previously owned property in Australia.
You’re also not eligible for the FHOG more than once – you can’t receive the grant in Queensland, for instance, then apply for a grant in Tasmania. There may also be further thresholds, so you should ensure you complete your own research.
What kind of property can I buy?
The First Home Owner Grant is only available to people buying a new home, unit, townhouse or similar, or a property that is being sold as a residence for the first time. Houses that have been substantially renovated may also qualify. People buying an established home are not eligible.
The value of the property is capped at $750,000 in most states and territories ($575,000 in South Australia, $1,000,000 north of the 26th parallel in Western Australia, and no cap in the Northern Territory or Tasmania).
Do I have to live in the property?
The grant is meant to help people buy their first residence, not an investment property, which means there are residence requirements.
For example, to be eligible in Victoria at least one applicant must be planning to live in the property for at least 12 months within a year of buying. In New South Wales and the Northern Territory at least one applicant must live in the property continuously for at least six months. Similar conditions apply in the other states and territories.
How do I apply?
Applications for the grant can be made up to 12 months after settlement or the issuing of a certificate of occupancy. In most states and territories you can make your application through the institution that is providing your finance, or directly with the government agency that administers the grant:
A Choice Home Loans mortgage broker can talk to you about how your credit rating will impact your home loan, and will likely be able to refer you to a financial counsellor if you’d like to sort out your debt.
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