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Author: David Saad

First home buyers need to act fast to maximise incentives

In the NSW Budget changes were made to Government incentives for first home buyers. These changes mean that some first home buyers could miss out on as much as $17,990 in stamp duty savings if they don’t buy before January 1 says Penrith Branch Manager David Saad.

 

What is the First Home Owners’ Grant (FHOG) scheme?

FHOG was introduced on 1 July 2000. It is a national scheme funded by the states and territories and administered under their own legislation. The scheme provides a $7,000 grant to first homebuyers regardless of their income or the area in which they are planning to buy or build. There is now a cap of $835,000 in NSW on the value of the home to be eligible. 

There have been a number of additional schemes and stimulus boosts including First Home Plus. This scheme waives stamp duty for most first home buyers in NSW. For homes under $500,000, a maximum amount of up to $17,990 is currently waived. Duty is also waived on vacant land valued up to $300,000, and there are concessions on duty for vacant land valued between $300,000 and $450,000. 

Purchase price $

Stamp duty saving under First Home Plus $

250,000

7,240

300,000

8,990

350,000

11,240

400,000

13,490

450,000

15,740

 

What has changed?

First Home Plus is being replaced with First Home - New Home Scheme. From January 1, 2012 the stamp duty concessions in NSW will only apply to new homes, including those built off the plan. No concession if you buy an existing home and knock it down to build a new home. 

This means that first home buyers purchasing existing homes will still get the $7,000 grant but no stamp duty savings. 

For those buying vacant land for a new home there is still no time limit on how long it takes to commence or complete building the home.   

What should first home buyers do?

For those first homebuyers ready to purchase they should act fast. You must have exchanged contracts before January 1, 2012 to be eligible for the old First Home Plus Scheme. 

Of course, there is no point rushing a purchase if they have not got their finances in order or the right property. Getting in over your head to save on stamp duty doesn’t make sense. And if you are looking at vacant land or a newly built home, there is no need to rush because stamp duty concessions are still available to eligible first homebuyers.

To find out more about first home buyers incentives and and the right home loan to meet your needs call 131386 or call in to see a friendly Greater branch manager. When you take your loan out with the Greater your branch manager will help make the First Home Owner’s Grant application for you.

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