There’s been significant changes in the First Home Buyer (FHB) market. The biggest change we’ve seen is the introduction of the new FHB stamp duty concessions and exemptions, along with the regional FHB grant in 2017.
What does the first home buyer stamp duty concession or exemption mean for me?
As of July 1, 2017 eligible first home buyers are now exempt from paying stamp duty on home purchases of $600,000 or less. If you are purchasing a home with a value form $600,001 – $750,000 you are still eligible for concessions, but they are applied on a sliding scale.
What exactly is Stamp Duty?
Stamp duty (commonly known as Land Transfer Duty) is a tax payable on the sale of property. The duty is paid by the purchaser and is collected in all states and territories of Australia. The amount of duty payable is calculated on the value of the property and needs to be paid within 30 days of settlement.
Am I an eligible First Home Buyer?
To be eligible for the FHB concessions and grants you must intend to live in the property as your Principal Place of Residence for at least 12 months, within the first 12 months of settlement. To be eligible for the grant you must be purchasing or building a new home ie. The property has not been occupied previously.
Unfortunately, you may not be eligible if you or your partner have lived in a home where you were an owner or part owner on or after July 1st 2000, for a continuous period of at least 6 months.
How much can I save?
This exemption represents a saving of up to $31,000 for eligible first home buyers. The best part is, this reduces the amount of money you’ll need to contribute upfront to the purchase of your home. Getting into your new home sooner – yes please!
What about the First Home Owners Grant (FHOG)?
From July 1st 2013 a $10,000 FHOG is available when you are building or buying a new home valued at $750,000 or less.
In Victoria, if you’re buying or building a new home in regional areas, the grant may be increased to $20,000. Macedon Ranges Shire here we come!
How does this affect my savings and what I need to contribute?
Overall, you’ll need less funds to contribute upfront to get into your first home. You might also like to check out our handy stamp duty calculator if you’re looking at a property worth over $600,000.
Get in touch with the Wealth Effect team and have a chat about your circumstances and plans today on 1300 459 101.