For many of those Australians who are budding first-time home buyers, this year has been filled with opportunity, especially in the property market, thanks to the Australian government’s new and improved incentives that have been rolled out this year.
Surprising to some, but not to others, 2020 has been the year that, according to the Australian Bureau of Statistics (ABS), over 14,000 loans were approved, and this was only in September. Statistics about this and their latest initiatives can be found on their website, click here.
Due to the lowest interest rate on record so far, this has made possible a lot of dreams coming true. The low-interest-rate has been backed by many AUs government initiatives and continues to be supported throughout the year and possibly in 2021 as well. For those who haven’t had that luck yet, the good news is, you can still apply for a home loan, and it is not too late.
It may be a daunting decision to make, as buying property is a big investment, and depending on how much you know about it, the feeling gets better. This is what we are here for, to make you feel good about your decision. Perhaps if you know the benefits the first-time home buyers got, it would help inch you closer to that loan. So, let’s dive right in, shall we?
Below we take a closer look at the benefits you may be eligible for.
Benefits for First Time Home Buyers in Australia
The Home Builder Program
In response to the current COVID-19 epidemic, the world is facing, the government of Australia has commenced the ‘HomeBuilder’ program, which provides first time home buyer or homeowners, who have a grant of $25,000 to use it to build their very own home, or even to renovate their existing one. There have been some recent updates and criteria to follow the program, which are mentioned below:
The deadline for applications has been extended to 14th April 2021. This is for the application of both the $25,000 grant and the new $15,000 grant. The contracts need to be signed by or before the 4th of June 2020.
If you sign a grant between 1 January 2021 and 31 March 2021, you may be eligible for a government grant of $15,000 which can go towards substantial renovations or new builds.
The start date of all construction has been extended from 3 months to 6 months only to Home Builder applicants, and these contracts must be signed by or before 1st January 2021.
The property price cap will be increased for new builds in some parts of Australia, for instance Victoria and New South Wales to $950,000 and $850,000, respectively. The existing price cap of $ 750, 000 will continue to some states and territories. Find out more about this and the various property prices of other regions such as Canberra, and the process of getting a loan, on this home loans website grapevinemortgages.com.au – Home Loans
To help Australians get themselves a home, the Victorian government implemented an investment of over $293 million for residential property contracts, that will fund a stamp duty concession of up to 50% for contracts signed between 25 November 2020 until 30 June 2021. Again, this is something that the government has rolled out, to help strengthen the economy, due to the negative impact the pandemic has had on the economies in Australia and around the world.
In order to fit the criteria, the home must be of a value below $1 million and can be off-the-plan homes or newly built property. Buying existing homes will reduce stamp duty to 25%. The biggest advantage of this is that it will provide buyers will considerable tax relief, and provide them with the foothold they need to buy themselves a place.
Home Loan Deposit Scheme
We saved the best one for last, the option of the government first home loan deposit scheme, which has been around for years but was closed until now. It is designed to assist home buyers to get their foot into the property market as soon as possible. While this idea has been seen to boost the residential building sectors it has already helped over 20,000 first-time buyers since January of 2020, securing a home loan.You should also look into usda financing if you are eligible for 100% home financing.
The scheme entails putting down a deposit of just 5% and you may be able to buy a newly-built property or even build one to your liking, yourself if that’s what you prefer. To buy any property one must typically put down a deposit of at least 20%, when the first-time buyer puts down their 5%, the government will guarantee that they put down the remaining 15% from their side.
This scheme is ideal for those who have not yet saved up enough for their first house, and it helps save you anywhere between $10,000 and $30,000 in lenders fees. Recently they have opened up the scheme again, and a further 10,000 first home buyers are allowed to apply for it before 30th June 2021. Grab it while you have the chance! Further details about this home loan deposit scheme arrangement can be read up on the government website.
With an improvement in house prices, lower deposits, recession on stamp duty, and low interest in mortgage rates, plus the additional incentives that first buyers are getting from property agents and mortgage brokers alike; now would be the best time to put your money into your very own new home investment or start building one so that in the new year you can have peace of mind knowing you got the best deal for your hard-earned savings.
A home is one of the best investments to make for anyone who can afford it. You can live in it for as long as you want to, and if you move out, you can easily rent it out, which in its own right, pays for the mortgage so you don’t need to.