First Home Owners Grant
First Home Owners Grant – General Information
To offset the impact of the introduction of the goods and services tax (GST), the Commonwealth has requested that the States and Territories assist first home buyers through the establishment of the First Home Owner Grant (FHOG).
The First Home Owners Grant applies from 1 July 2000. Each State and Territory Revenue Office is responsible for administrating the grant in their respective jurisdictions.
The broad principles of the grant are:
1. Eligible applicants will be entitled to a one-off $7,000 payment.
As of 1 October 2012 the grant in NSW will be increased to $15,000 but will only be available to first home buyers purchasing or building a new home. As of 1 October 2012 there will be no grants paid in NSW for the purchase of established properties.
In QLD, from Wednesday 12 September 2012, the new First Home Owner Construction Grant (FHOGC) replaced the current First Home Owner Grant Scheme. The new grant is for first home buyers who are purchasing a newly constructed or off-the-plan property and will increase from $7000 to $15,000. To be eligible for the new $15,000 grant, first home buyers must sign contracts for new properties on or after Wednesday 12 September 2012. Contracts signed prior to Wednesday 12 September 2012 will be eligible for a $7000 grant.
Note: First home buyers in QLD who are purchasing an existing dwelling will have until Thursday 11 October 2012 to sign their contract and be eligible for the $7000 grant. A first home buyer purchasing an established home on or after Thursday 11 October 2012 will no longer be eligible for a grant. A new home is a home that has not been previously occupied or sold as a place of residence.
2. Eligible applicants must be natural persons, who are Australian citizens or permanent residents, who are buying or building their first home in Australia.
3. Applicants must be at least 18 years of age.
4. To qualify for assistance, neither the applicant nor their spouse (or de facto) must have previously owned a home, either jointly, separately or with some other person.
5. Entering into a binding contract or commencement of building, in the case of owner-builders, must have occurred on or after 1 July 2000.
6. An eligible home will be located in Australia and will be a new or established house, home unit, flat or other type of self contained fixed dwelling that meets local planning standards.
7. An eligible home must be intended to be a principal place of residence. Applicants must occupy the home within 12 months of completion of construction or settlement and must live in the home for a continuous period of at least 6 months.
8. Assistance will not be means tested.
9. Joint applicants will be restricted to a single application for a single property and only one payment of $7,000 will be made.
The grant assistance will not be income means tested and joint applicants will be restricted to a single application for a single property and only one payment of $7,000 will be made. If the consideration of the home is less than $7000 then the grant amount paid to the applicant will equal the consideration.
PROPERTY VALUE CAPS
Although the First Home Owners Grant is not means tested there is a property value cap that applies. Applicants who purchase or build a home which has a total value of more than these cap amounts will not be eligible for the grant. These caps are as follows:
- NSW – $835,000 cap applies where the commencement date of the eligible transaction is on or after 1 January 2011 up until 30 September 2012. On 1 October 2012, the cap reduces to $650 000. The $650 000 cap will apply to all new home transactions where the commencement date of the eligible transaction is on or after 1 October 2012. Applicants who purchase a new home or build a home which has a total value of more than $650 000 will not be eligible for the First Home Owner Grant (New Homes) Scheme.
- WA – purchase property value capped at $750,000 for post codes south of the 26th parallel (i.e. from Kalbarri 6536) and $1,000,000 for post codes north of the 26th parallel (i.e. from Denham 6537).
- VIC – purchase property value capped at $750,000 (a farm purchased as a principle residence is excluded from the cap).
- QLD – purchase property value capped at $1,000,000 for transactions entered into on or after 1 January 2010 to 30 March 2010. A $750,000 cap will apply for transactions entered into on or after 31 March 2010.
- NT – purchase property value capped at $750,000 (First Home Owner Transfer Stamp Duty Concession eligibility will also be capped at $750,000 for established dwellings and $385,000 for vacant land).
- SA – the purchased property value must not exceed $575,000.
- ACT – the purchased property value must not exceed $750,000. This cap does not apply to eligible transactions that commenced before 1 January 2011.
- TAS – no purchase property value cap applies.
First home buyers who purchase a property for more than the capped prices listed above will not be eligible for the First Home Owners Grant.
Conditions for land and construction
.NSW, QLD, WA and NT – Assessment of applications involving construction of a dwelling, including Off the Plan applications, will use the total land and construction value as at the date of the contract.
. VIC – Assessment of applications involving the construction of a dwelling, including Off the Plan applications, will use the construction value only as at the date of the contract.
ADDITIONAL STATE FIRST HOME BUYER BONUSES
Some states offer additional grants and bonuses to first home buyers.
Please visit our stamp duty concession page for more information on this.