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Buying your first home is an exciting milestone, but it can also feel overwhelming with so much to consider. If you're looking to purchase your first property in Queensland, here are some key points to help guide you through the process and make the most of the benefits available to you. As I am a finance broker based in Brisbane the information below is tailored to suit Queensland FHB. Similar schemes may also be available in your relevant state or territory apart from the Home Guarantee Scheme which is a national scheme.
Genuine Savings
In all applications to purchase a property you need to be able to demonstrate genuine savings. Genuine savings is at least 5% of the purchase amount that has been genuinely saved and preferably held in a bank account for a period of 3 months prior to purchasing. This is demonstrating to a lender that you have the ability to save money while paying other life bills and rent to save a deposit. The higher the deposit that you have for a purchase. Could be the different between paying Lenders Mortgage Insurance if you deposit is less than 20% plus purchasing costs and paying Lenders Mortgage Insurance.
Stamp Duty Concessions
First home buyers in Queensland are eligible for stamp duty concessions, which can significantly reduce the costs associated with buying property. If your home is valued under $700,000, you may be exempt from paying stamp duty altogether. For properties up to $800,000, concessional rates apply.
How it works:
- Homes under $700,000: No stamp duty payable.
- Homes between $700,001 and $800,000: Concession rates apply, reducing the total stamp duty payable with full stamp duty payable above a $800,000 purchase.
Please note that when purchasing vacant land, the concessional amounts are different to purchasing an existing property. If your land purchase is under $360,000, you may be exempt from paying stamp duty. For land up to $500,000, concessional rates apply.
- Land under $360,000: No stamp duty payable.
- Land between $360,001 and $500,000: Concession rates apply, reducing the total stamp duty payable with full stamp duty payable above a $500,000 purchase.
First Home Super Saver Scheme (FHSSS)
The First Home Super Saver Scheme allows you to save money for your first home deposit through your superannuation fund, potentially benefiting from tax savings. You can withdraw up to $50,000 of voluntary contributions to put towards your first home. The extra voluntary contributions towards your superannuation can be used as part of your genuine savings
First Home Owner Grant (FHOG)
The Queensland First Home Owner Grant is a fantastic incentive for first-time buyers. Eligible buyers can receive $30,000 towards the purchase or construction of a new home valued at less than $750,000. This grant can be a great boost to your deposit or help cover other upfront costs. The timing of the payment does depend on the eligible transaction type. Each State may have a different FHOG conditions and amounts. There are eligibility requirements as the FHOG can only be used to:
- Buying a new home that has not been lived in.
- Off-the-plan purchase.
- Substantial renovation.
- Contract to build.
- Owner-builder.
Federal Government Home Guarantee Scheme
- First Home Guarantee: Under the Home Guarantee Scheme, eligible first home buyers can purchase a home with as little as 5% deposit without the need to pay LMI. The Australian Government acts as a guarantor for the remaining deposit.
- Regional First Home Buyer Guarantee: For those purchasing in regional areas, this scheme allows you to buy with a low deposit while also encouraging growth in regional communities.
There are limited places for the scheme released each financial year. Eligibility in the scheme is dependent and reserving a place under your relevant scheme. There are eligibility requirements and threshold limits for the Home Guarantee Scheme:
1. Income threshold for:
- single applicant income to be $125,000 or lower.
- couple applicants combined income to be $200,000 or lower.
2. Maximum purchase limits:
- QLD Capital city and regional centre up to $700,000 (QLD Regional centres are Gold Coast and Sunshine Cost regions)
- QLD rest of state up to $550,000
- Please refer to Housing Australia website for the threshold limits in your state or territory.
3. Australian Citizen
Budgeting for Other Purchasing Costs
Aside from the purchase price, there are a number of additional costs to consider:
- Building and pest inspections
- Conveyancing and legal fees
- Home and contents insurance
- Moving costs
