Saving up for your first home can be challenging; not only is there a sizeable deposit to worry about, but closing costs, stamp duty and additional fees to consider as well. Fortunately, Australia has made significant efforts over the past couple of decades to make home ownership more affordable and feasible, especially for first-time buyers. For instance, in 2000, the First Home Owner Grant (FHOG) was implemented and remains in place today, with some changes.
About Australia’s First Home Owner Grant
When the FHOG was first introduced, real estate markets in Melbourne and other large cities saw significant increases in both first-time purchases and new builds. In fact some states such as Western Australia saw a 91% increase in new first-time-buyer commitments in the months following the passage of this grant. Specifically, this grant provided monies up to $10,000 to first-time homebuyers, which helped immensely when it came to offsetting closing costs and similar fees for first-time buyers with no equity in another property.
However, beginning in July of 2013, changes were implemented to the FHOG that made the funding available only to first-time buyers who were building new homes, townhouses, apartments, or other residential units. As a result, fewer people have applied for this grant in recent years. This makes sense, especially when you take into consideration the disconnect between city housing affordability and first-time buyer budgets. On the other hand, an increasing number of applications for this grant have begun coming in from fringe suburbs, where new builds are becoming very popular.
In recent days, the Victorian government have announced further changes to the FHOG. From July they will be axing stamp duty for first homebuyers in Victoria on properties under $600,000. Discounts will also be available on properties priced between $600,00 and $750,000 regardless of whether the property is a new build or existing. This news follows on from the Victorian state government’s announcement that they will be doubling the FHOG to $20,000 for first homebuyers in regional Victoria. This move is aimed at assisting regional Victorians to build and live in their own communities.
Considering a New Build?
If you’ve been dreaming about owning your first home, the fact is that there has never been a better time to build your own home. Not only can building a home from the ground up allow you to get exactly the home you want (rare for a first-time buyer), but you could also be eligible for up to $10,000 from the FHOG. Some of the key eligibility requirements for this grant include:
- Be age 18 or older
- Be an Australian citizen
- Have not owned a home in Australia or received another first-owner grant
If you meet these eligibility requirements, you may want to consider submitting an application. Along with your application, you will need to provide some basic information, such as proof of citizenship and documentation related to your new home. This is a wonderful opportunity for first-time home builders who may not otherwise be able to afford their dream home, especially if you’ve been dreaming about building your own home in the suburbs.
If you’re looking for a home builder with years of experience in Melbourne’s Northern and Western suburbs, Mimosa Homes is here to help. Explore our package options, including house and land packages, to get started in creating your dream home. We’d love to help you turn your dreams of new home ownership into a reality.