First Home Owners NSW
With 1 July 2017 and the start of the New Financial Year, the NSW State Government rolled out changes to the First Home Owners benefits that are available.
For first home buyers, the 2017 comprehensive package will:
- abolish stamp duty on all homes up to $650,000, previous exemptions were only for new homes. This will expand the properties available and affordable to first home owners.
- give stamp duty relief for homes purchased or valued at $650,001 up to $800,000 to be calculated on a sliding scale commensurate with the vale or purchase price of the property. NSW government has chosen house prices in the range of $650,000 to $800,000 for duty concessions because $700,000 was the median home price in the State.
- provide a $10,000 grant for builders of new homes up to $750,000 and purchasers of new homes up to $600,000.
- abolish the duty charged on lenders’ mortgage insurance, providing a saving of about $2,900 for a $800,000 home.
- ensure foreign investors pay higher duties and land taxes by doubling the surcharges on these taxes from four percent (4%) to eight percent (8%).
- no longer allow investors to defer paying stamp duty on off-the-plan purchases.
- introduce the ‘First Home Buyers Assistance shared equity arrangements’ to allow eligible purchasers to buy property with other parties (such as family and friends) and still receive a concession. To qualify, the eligible purchasers must buy at least fifty per cent (50%) of the property. The value limits and other eligibility criteria of First Home Buyers Assistance apply. Transfer duty is calculated with reference to the proportion of the property purchased by other parties.
Concessions on vacant land will remain unchanged.
The current schemes in place are:
- First Home—New Home scheme: commenced from 1 January 2012 and provides eligible purchasers with exemptions from transfer duty on new homes valued up to $550,000 and concessions for new homes valued between $550,000 and $650,000.
Eligible purchaser buying a vacant block of residential land to build their home will pay no duty on vacant land valued up to $350,000, and will receive concessions for vacant land valued between $350,000 and $450, 000. These rates apply from 1 July 2012.
- First Home Buyers Assistance scheme: commenced on 1 July 2017 and provides eligible purchasers with exemptions on transfer duty on new and existing homes valued up to $650,000 and concessions on duty for new and existing homes valued between $650,000 and $800,000.
Eligible purchasers buying a vacant block of residential land to build their home on will pay no duty on vacant land valued up to $350,000, and will receive concessions on duty for vacant land valued between $350,000 and $450,000.
- First Home Owner Grant (New Homes) scheme: The grant amount is determined by the date of the eligible transaction. This is the date of the contract to purchase a new home or contract to build a home. For an owner builder, the eligible date is when the building work commences.
From 1 July 2017, the First Home Owner Grant Cap for new home purchases is $600,000; for a property where you enter into a contract to build, or are an owner builder the total value cannot exceed $750,000.
For eligible transactions made on or after 1 January 2016, the grant amount is $10,000.For eligible transactions made between 1 October 2012 and 31 December 2015, the grant amount is $15,000.
The eligibility criteria for first home buyer schemes vary, however they generally include:
- The purchasing entity must be a first home buyer as a person, not as a company or trust.
- At least one (1) applicant must be a permanent resident or Australian citizen.
- Each applicant must be an adult of at least eighteen (18) years of age.
- None of the purchasers can ever have previously owned an interest in land in Australia which had a residence on it, before 1 July 2000.
- The Purchaser and their spouse or partner cannot have lived in a residential property which they owned from 1 July 2000.
- Purchaser must not have claimed any First Home Owner Grant previously.
- The Purchasers must occupy the first home as their principal place of residence within twelve (12) months of the construction or settlement of the home and for the minimum period of occupancy of six (6) continuous months.
If you are looking to buy your first home, contact Kreisson to guide you through the process.
This communication is sent by Kreisson Legal Pty Limited (ACN 113 986 824). This communication has been prepared for the general information of clients and professional associates of Kreisson Legal. You should not rely on the contents. It is not legal advice and should not be regarded as a substitute for legal advice. The contents may contain copyright.