Want to buy your first home with a 5% deposit and save up to $10,000?⁣⁣

On your marks, get set, go! The race is on for limited spots in the federal government’s First Home Loan Deposit Scheme, which kicked off again on July 1.⁣⁣
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The scheme allows eligible first home buyers with only a 5% deposit to purchase a property without paying for lenders mortgage insurance (LMI) – which can save you up to $10,000. ⁣⁣
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But here’s the catch: only 10,000 spots are available this financial year.
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That might sound like a lot but 3,000 spots went in the first 10 days last time. ⁣⁣

What exactly is the First Home Loan Deposit Scheme (FHLDS)?

Usually, first home buyers with a deposit of less than 20% have to fork out for LMI when taking out a home loan.

But under the federal government’s FHLDS, eligible first home buyers with only a 5% deposit can purchase a property without having to pay for LMI.

Now, it’s important to note this is not a handout – it’s a government guarantee to help first home buyers break into the property market with a smaller deposit.

But the good news is that it is available alongside other state and federal government first home buyer schemes that are currently running.

More details on eligibility and property price caps can be found on the scheme’s website http://www.nhfic.gov.au.

Let us run you through the details

If you’re thinking about purchasing your first home soon and are considering applying for this scheme – give us a call today.

While 10,000 spots might sound like a lot, the starter’s gun has already gone off and hundreds of first home buyers could apply for the scheme every day in the first two weeks alone.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

The post Want to buy your first home with a 5% deposit and save up to $10,000?⁣⁣ appeared first on RB Finance.

Final touches on $25,000 HomeBuilder scheme announced

The “crucial final touches” on the federal government’s $25,000 HomeBuilder scheme have been revealed. Will your build be eligible?

When the federal government announced its $25,000 HomeBuilder scheme in early June the immediate reaction from many was ‘you little beauty’, quickly followed by, ‘wait… will my project even be eligible?’

It’s a question that’s lingered for a few weeks, however we now have more clarity.

And the good news is that the Housing Industry Association (HIA) – the construction industry’s peak national body – has welcomed what it’s labelled the federal government’s “crucial final touches” on the scheme.

So what are these final touches? Let’s take a look.

More wiggle room for finance and building approvals

It looks as though homeowners now have a little more wiggle room when it comes to having their finance, building proposals and other legal requirements approved.

One of the biggest criticisms of the scheme when it was first announced was that homeowners needed to get everything approved and construction commenced within a fixed three-month timeframe.

Now, the scheme’s official FAQ on the Treasury website still states that construction must commence within three months of the contract date.

However, it now adds a provision for cases where approvals are unexpectedly delayed.

“States may exercise discretion where commencement is delayed beyond three months from the contract date due to unforeseen factors outside the control of the parties to the contract. For example, delays in building approvals,” Treasury states.

Here’s what the HIA adds on the update: “Recognising that a fixed three-month timeframe to commence building work did not reflect how dependent home builders are on other players, like the banks, the councils and building certifiers, is extremely important.”

Off-the-plan apartments and townhouses

Off-the-plan apartments and townhouses that don’t exceed $750,000 are eligible for HomeBuilder.

But what was doing a lot of people’s heads in was the timing of it all: did it simply need to be an off-the-plan purchase? Could construction have already been underway?

Well, we now have some clarification.

To qualify for the scheme the first box to tick off is that you need to sign the contract to buy the off-the-plan dwelling on or after 4 June 2020, and on or before 31 December 2020.

The second box is that construction needs to commence on or after 4 June 2020, and no later than three months after the contract is signed.

If, however, you sign the contract to buy the dwelling after 4 June 2020, but construction commenced before 4 June 2020, then the home won’t qualify for HomeBuilder.

Now, as mentioned in the above section, keep in mind that states and territories may exercise discretion where the commencement of construction is delayed beyond three months and it’s outside your control.

However, you’ll definitely want to ensure you do your due diligence on the project’s estimated construction date to give yourself the best possible chance of receiving the $25,000 grant.

Payments expected to be aligned with first home owner grants

Last, but certainly not least, Treasury released more information on the timing of the $25,000 payments.

“It is expected that, where possible, states and territories will align the HomeBuilder application processes with existing processes for first home owner grants (or similar),” Treasury states.

Basically, this means the ball is now in the court of state and territory revenue offices, which will soon outline the final details of how applicants can apply as well as the timing of the payments.

And the good news is the HIA is optimistic.

“HIA has been working closely with state and territory revenue offices and we look forward to receiving these details soon, which will assist home buyers and builders to begin taking full advantage of the grant,” the HIA said.

Get in touch

As mentioned above, while the federal government has provided its final touches on the scheme, we’re still waiting for each state and territory to confirm their own final touches.

But if it looks like you’ve ticked the above boxes and you want to start looking at financing options for your HomeBuilder project, please get in touch.

As with most things in life, the more organised you are, the better!

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

The post Final touches on $25,000 HomeBuilder scheme announced appeared first on RB Finance.

You might be closer to your first home than you think

You’ve probably heard the federal government is giving $25,000 grants to eligible Australians looking to build or substantially renovate their homes. Today we’ll look at what that means for first home buyers when combined with state and territory schemes.

If you’ve been umming and ahhing about purchasing your first home for a while now, we have great news: you’d be hard-pressed to find a time when there were more government incentives to help you enter the property market.

For starters, there’s the federal government’s First Home Loan Deposit Scheme, which can help you buy your first home with a deposit of just 5% without having to pay lenders mortgage insurance (LMI) – so that’s one major cost out of the way.

But you’ll still need that 5% deposit, right?

Well, each state and territory (except ACT) has a first homeowner grant program, with most grants between $10,000 and $20,000.

On top of that, the federal government will give eligible Australians $25,000 to build or substantially renovate homes as part of the new HomeBuilder scheme (however, at this stage it’s still unclear whether or not this amount can go towards your initial deposit).

Last but certainly not least, most states and territories have stamp duty discounts or exemptions for first home buyers too, which can save you tens of thousands of dollars – another hurdle cleared!

Below, we’ll break down exactly what’s on offer in each state and territory and just how much these government initiatives could help put you within reach of a deposit on your first home.

QUEENSLAND

First homeowner grant: $15,000 on new homes valued at less than $750,000, plus the $5,000 Regional Home Building Boost Grant.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: exemption on homes up to $500,000, partial concession on homes up to $550,000.

With HomeBuilder, you could have: up to $45,000 in government support + up to $15,925 in stamp duty concessions & $10,000 in LMI savings.

NEW SOUTH WALES

First homeowner grant: $10,000 for new homes valued up to $750,000.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: exemption on homes up to $650,000, partial concession on homes between $650,000 and $800,000.

With HomeBuilder, you could have: up to $45,000 in government support + stamp duty exemption.

VICTORIA

First homeowner grant: $10,000 (urban) and $20,000 (regional) for new homes valued up to $750,000.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: exemption on homes up to $600,000, partial concession on homes between $600,001 and $750,000.

With HomeBuilder, you could have: between $45,000 and $55,000 in government support + stamp duty exemption.

WESTERN AUSTRALIA

First homeowner grant: $10,000 on new or substantially renovated homes valued at less than $750,000 south of the 26th parallel (latitude), or less than $1,000,000 north of the 26th parallel. WA also offers $20,000 grants for new homes built on vacant land or off-the-plan single-storey developments.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: exemption on homes valued at up to $430,000, partial concession on homes up to $530,000. An off-the-plan unit rebate is available for more expensive homes.

With HomeBuilder, you could have: up to $65,000 in government support + applicable stamp duty concessions.

SOUTH AUSTRALIA

First homeowner grant: $15,000 on new homes valued up to $575,000.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: full concession on off-the-plan new or substantially refurbished apartments up to $500,000.

With HomeBuilder, you could have: up to $50,000 in government support + stamp duty concession.

TASMANIA

First homeowner grant: $20,000 on new homes (reduced to $10,000 from 1 July 2020).

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: a 50% discount on stamp duty for established properties valued at $400,000 or less.

With HomeBuilder, you could have: up to $55,000 in government support.

AUSTRALIAN CAPITAL TERRITORY

First homeowner grant: none.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: first home buyers in the ACT pay no duty so long as their household income is below $160,00-$176,650, depending on how many dependents you have.

With HomeBuilder, you could have: up to $35,000 in government support + stamp duty exemption.

NORTHERN TERRITORY

First homeowner grant: $10,000 for new homes.

First Home Loan Deposit Scheme: LMI saving of up to $10,000.

Stamp duty: you can get up to $18,601 off your stamp duty costs.

With HomeBuilder, you could have: up to $45,000 in government support + up to $18,601 in stamp duty savings.