Government Grants and Incentives
Government Grants and Incentives for First Home Buyers and other eligible parties are both state and nationally based. It is important to note the National schemes are run by Financial Year. These are up for review in July 2024 and changes may be made to numbers of places available, income threshold or any other eligibility criteria without prior notice.
One of the most popular guarantees is the First Home Guarantee (FHG). In summary, it is a government guarantee that allows as little as 5% deposit, and also waives the cost of Lenders Mortgage Insurance. There were 35,000 places released in July 2023 with some still available until they run out or at the end of June 2024 (whichever occurs first). This Financial Year we have seen no delays, unlike in some previous years where there was a long wait time for approval.
Eligibility for this scheme is heavily based on income as listed on your Notice of Assessment (NOA). For this financial year (July 2023 to June 2024) the income threshold is $125K for a single and $200K for a couple. This is determined by your NOA and not the income you may have earned this year. You can use the NOA from 2023 up until June 2024.
Our team of Brokers have helped many Home Buyers into homes this year that may now have a higher income, making them ineligible for this Grant after the new requirements are due, being July 1st, 2024. The reason I believe that this point is critical is that there is a time frame in place that we know we can use these grants, and we have only one full quarter left.
There are other Grants that can be used in conjunction with this guarantee such as the state based Stamp Duty Concessions, however these are not up for review with the National Schemes in July.
In my experience, First Home Buyers that are looking to enter the market in 2024 need to look at schemes now to ensure that the potential changes or changes in their own income will not be impacted by the changes in July. It is so important if you are saving or getting ready to buy that you have a chat with a Mortgage Broker and understand what is available to you to ensure that you are looking at all the possible options.
Along with the First Home Guarantee there is also the Family Home Guarantee that requires as little as a 2% deposit and the Regional Home Guarantee. Our National Team does much less of these than the more popular First Home Guarantee Scheme.
To summarise for the term of 1 July 2023 to 30 June 2024, based on the 2023 Notice of Assessment requirements include:
First Home Buyers or have not owned a property in the past 10 years
Individuals income under $125K and Couples $200K (taken from the 2023 NOA - this is very important to note)
Over 18
Australian Citizen or Permanent Resident
A 5% Deposit (can be less for the Family Home Guarantee)
Suitable Property threshold and property type
These National Schemes are also only with certain lenders, and these lenders have differing amounts of places available as well as their own differing lending requirements. For example, some lenders will allow rental payments made as genuine savings and some will not. The Scheme is the same but the lenders have differing policies, which is when the experience of a Sphere Broker is crucial in order to guide you through not only the Schemes but the Lenders requirements. We are always excited to talk to clients at every stage of their property journey, even if they may be months off buying, because it is important to get the correct plan in place nice and early.
The Sphere Home Loans team have been extremely excited about the number of Home Buyers we have helped so far this Financial Year using these schemes, and I am writing and sharing this now to to ensure that you are armed with information - if you are eligible now and may not be in July 2024 you need to be aware of the time frames involved and the potential changes.
Please reach out to our team at hello@spherehomeloans.com.au and book a free 15-minute chat with a Broker to work out what you may be eligible for. Sphere Home Loans Brokers are independent Brokers, at no cost to the client, and always working in our client’s best interests - we’re here to help!
Sphere Home Loans Director Rachelle Kroon