Everything you need to know about the First Home Owners Grant

Have you been thinking about buying your first home or building a new one? If so, you might be considering applying for the First Home Owner Grant (FHOG). Australians can get financial assistance for the first home they buy or build through the First Home Owner Grant program. 

Getting the money to fund your dream home is difficult, so the government provides a one-time payment through the First Home Owners Grant.

Some people do not have enough information regarding the First Home Owners Grant, so to help them, we have prepared this article. Here, you will get to know more about this program, eligibility criteria and a few other essential things.

What is the First Home Owner Grant?

The First Home Owner Grant allows first-time homebuyers to purchase or build a new home as their primary residence with a small grant. The program was first available to first-time homebuyers back in 2000. 

Although the program is national, each state or territory funds it separately, and each state sets its own rules. The prime goal of FHOG is to help people to purchase their first homes by saving up.

You might be interested to know how much you can borrow today. Please use online borrowing power calculator on our website.

What Is the Amount of The First Home Owners Grant?

Each state and territory administers the First Home Owner Grant through its legislature. Because of this, each state offers a different grant.

A person's first home purchase amount depends on their location. For example, FHOGs in Queensland and South Australia is worth $15,000, $20,000 in Tasmania and $10,000 in New South Wales, Western Australia, Northern Territory, and Western Australia.

Eligibility Criteria for First Home Owners Grant

If you meet the following criteria, you might be eligible for the First Home Owner Grant. There are some differences in requirements between states and territories. However, some of the eligibility criteria for all the states and territories are the same, listed below. 

• The age requirement for applicants is 18 years old.
• Companies and trusts are not permitted to apply.
• The applicant is going to purchase a new property or build a house.
• One applicant must be a resident of Australia or a citizen.
• The applicant may not have owned residential properties in Australia.
• In Australia, the applicant is not eligible for an FHOG if they have already received one. But applicants may be eligible for a grant that has already been repaid.
• You must apply within one year following the completion of the eligible transaction.

These are some eligibility criteria that are the same in all the states and territories of Australia.

*A  new property is a brand new dwelling (e.g. house, unit, duplex, townhouse; or granny flat built on a relative’s land) that has not been previously occupied as a place of residence or sold as a place of residence. 

If you want to know more about eligibility criteria in each state book a free consultation with one of our mortgage brokers.

First Home Owners Grant Criteria in Different States & Territories

As previously mentioned, states and territories have different FHOG criteria, which you will learn in this section. If you fulfil these criteria, you can apply for the First Home Owner Grant without any issue.

First Home Owners Grant in New South Wales 

• At least six months must pass since the applicant lived in the home.
• The value of a newely built home can’t exceed $750,000 (including land).
• In Australia, applicants must have held no ownership interests in or occupation of the same property for six months after the 1st of July 2000.
• When purchasing a new property or “substantially renovated” project, the value should not exceed $600,000.
• You must sign the contracts for building or buying the home on or after the 1st of January 2016.

First Home Owners Grant in Queensland 

• The property's value must be less than $750,000.
• There must not have been any property ownership in Australia after the 1st of July 2000.
• The transaction must have taken place no earlier than the 1st of July 2016.
• The prospective resident must occupy the property for at least six months.
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First Home Owners Grant in Australian Capital Territory  

• The Australian Capital Territory has not provided grants for first-time homebuyers since 1 July 2019. It has been done by significantly extending the concessions and exemptions offered by the territory.

First Home Owners Grant in South Australia 

• To qualify for the program, applicants must live in the property for six months within one year of completing the transaction.
• The applicant must sign the contract after 17 September 2010.
• After 1st July 2000, applicants cannot have owned or occupied the property in Australia for the preceding six months.

First Home Owners Grant in Victoria  

• Applicants must reside on the property for at least one year after the closing of the transaction.
• Properties must have an appraised value of less than $750,000.
• For at least six months after 1st July 2000, applicants are prohibited from having interests in the same property in Australia.

First Home Owners Grant in Northern Territory 

• An applicant may not have owned or occupied the same property since 1 July 2000.

First Home Owners Grant in Tasmania 

• Applicants must spend a minimum of six months in the home within one year of closing.
• In Australia, applicants cannot have owned or occupied the same property after 1st July 2000.

First Home Owners Grant in Western Australia 

• If the applicant wants to participate in the program, they must reside in the property for six months after purchase.
• In addition, applicants must have lived in this property for at least six months following the 1st July 2000.

How Do I Apply for a First Home Owner Grant?

The First Home Owner Grant application process is not so complicated as many people think. If you need assistance with your application, you can contact us, and we will handle all the complicated tasks for you.

However, before applying for FHOG, you will need to check whether you are eligible or not. The above eligibility criteria will let you know about your eligibility status.

Is the First Home Owner Grant Acceptable as Deposits?

FHOG can be used as part of the deposit, but existing savings are often required, as the deposit is rarely covered by the FHOG alone. When you lack savings, your parents may be able to guarantee your loan.

You can check monthly repayments of your future loan using Online calculator on our website.

Can You Use FHOB for Purchasing Investment Property?

If you want to receive the FHOG from the government, you can’t buy an investment property. In Australia, you usually have to reside in your home for at least six months to qualify for the FHOG. We would recommend you to review local requirements regularly.

Summary

As previously mentioned, each state and territory has set different rules for the First Home Owner Grant. Therefore, depending on the state you are applying to, you should first check the eligibility criteria and rules. 

Further, the process of applying for the First Home Owners Grant can be somewhat daunting if you are new to it. Please feel free to book a free consultation from our website if you have any questions about the First Home Owners Grant.