fbpx

First Home Owners Grant QLD 2022

Are you after the ultimate guide to the First Home Owners Grant QLD in 2022? Then look no further! 

But before we begin, let me be clear about something:

This is NOT a lame First Home Owners Grant QLD guide written by egg heads in complicated legal jargon. 

Instead, you’re going to get the simple breakdown of the $15,000 First Home Owners Grant, what you can do to qualify for right now and what will work even better in 2022 than ever before.

So if you’re looking for all the answers on the First Home Owners Grant in Queensland you’ll love this guide.

Don’t have time to read the whole guide right now?

FIRST-HOME-OWNERS-GRANT-QLD-2021

No worries. Let me send you a copy so you can read it when it’s convenient for you. Just let me know where to send it (takes 5 seconds):

ELIGIBILITY TESTER:

Try the eligibility tester

The First Home Owners Grant is INCREDIBLY popular this year and with the national budgetary announcements in late March (promising almost double the amount of grants given out in 2022), the competition has never been greater! 

In particular, the Queensland Government is committed to helping Queenslanders get into their own home sooner than ever before.

In fact, you might be able to qualify for $15,000 from the government in 2022.

The question is:

Are you eligible for the First Home Owners Grant in QLD? 👇

Are you eligible for a First Home Buyers Grant in QLD? Take our quiz to find out if you qualify for the $15,000 or $20,000 Grant 💰
Start press enter
1 → Are you: *
2 →When will you be signing your contract? *
3 →Have you, your spouse or another applicant ever been paid a first home owners grant or owned property before in Australia? *
4 →What is the value of the home you are purchasing? *
Sorry you don't qualify for the first home owners grant. It could be because you are buying an existing property 🏠, the value is over $750k or you may have received the grant in the past.
Holy smokes you might qualify for the $20,000 First Home Owners Grant in Queensland because your contract was signed before 30 June 2018. For more info chat to our team 🙌
Sweet you might qualify for the $15,000 First Home Owners Grant in Queensland. Chat to our team for more details! 🎉
Try again press enter

Our eligibility test uses the First Home Buyers Grant QLD 2020 criteria, as detailed by the Queensland Government.

CHAPTER 1:

Is the first home owners grant still available in QLD?

You’re in luck! The $15,000 First Home Owners Grant is still available in Queensland!

If you sign a building contract or buy a brand new (never been lived in before) home from 1 July 2018 onwards, you may receive the Grant as long as you meet the remaining criteria I cover in this guide.

The Grant is a national scheme that is funded by each state or territory. Originally the Grant started on 1 July 2000 at $7,000 to offset the effect of the GST on homeownership, increased to a peak of $21,000 (those were the days), then reduced to the current level of $15,000 where it will stay for many years to come.

You may have also heard of the HomeBuilder Grant, a $15,000 Grant for people building a new home, buying a brand new home or doing a big renovation. But, this has now ended as of 31 March 2022.

When Does The First Home Owners’s Grant End In Queensland?

At this time, there are no plans by the Queensland government to end the first-time homebuyer grants anytime soon. Although grants were higher in previous years, the current $15,000 first home grant has stabilised. It is still available for first-time purchasers buying new-build properties or building a property in 2022 – and signs are that this will continue.

For first-time buyers looking to buy a pre-existing home (one that’s been occupied before or that isn’t a new-build), the first home buyers grant Qld stamp duty relief applies. This enables first-time buyers to enjoy relief of up to $8,750 on their stamp duty, provided the cost of the property is below $500,000. First-time homeowners who are choosing to build their property can take advantage of both stamp duty relief up to $7,150 on their land purchase (provided the value of the land is less than $250,000 and the first-time buyers home grant).

We also monitor the Queenlsand Government budget announcements regularly and as of yet, there has not been any mentions of the grant ending. But if you’d like to stay update, I’d recommend you subscribe to our Youtube Channel where we regularly post with any and all updates that the government announce.

For example, check out below our recent update where we talk directly about what the government have just announced for First Home Buyers in 2022. 

How much is the first home buyers grant QLD?

The amount of the first home buyers grant in Queensland depends on when you signed the building contract:

How much is the first one buyers grant QLD? 🧐
$15,000 First Home Buyers Grant 💰
Cost saving on stamp duty 💵
Buying a new home 🏡
Yes, if contract signed after 1/7/2018 ✅
Yes ✅
Building a new home 🏗
Yes, if build contract signed after 1/7/2018 ✅
Yes ✅
Buying an established (or existing) home 🏠
No ⛔️
Yes ✅

 

For a home to be considered new, the Office of State Revenue will need confirmation that the property has not been previously lived in, has not been previously sold as a place of residence and can be a substantially renovated home.

If you’re a bit confused if your potential home qualifies, contact us at any time and we can help you through the process. 

building house brisbane

Does The First Home Owners’ Grant Count Towards Your Deposit?

The $15,000 First Home Buyers grant money can be used for a deposit for your home purchase.

That said, because the grant is not normally handed across until the transaction is completed, you may well need to find the money up-front to cover the deposit in order to satisfy the requirements. Different home loan providers have different criteria: some may accept proof of your eligibility for a grant as sufficient guarantee that you will be able to pay the deposit, others may not.

However, it is best to check with your broker prior to signing the final paperwork to make sure you’ve applied, been successful, and the award has been paid.  

IMPORTANT CAVEATS about using the First Home Owners Grant as a part of your deposit.

 

The key element to consider when considering using the First Home Owners Grant as part of your deposit is that if you want to borrow money from the bank to buy your home, you need to show the bank that you can genuinely save money. 

Getting the First Home Owners Grant and using it as a deposit is a fantastic leg up, but by no means does it show the bank any evidence to suggest you have discipline with your money. Banks love people who can reliably make their home loan repayments each month. After all, if they are lending you money, they want to make sure they get their money back and know that it will not just be flushed down the toilet on little treats like Uber Eats or gambling.

 So, what are the banks/lenders looking for in your home loan application? 

They request every little piece of information they can to truly identify a person’s spending habits and do thorough research to help them determine who may be a little risky to lend money to. Banks also know that as a first home buyer, you may not have huge savings, but you probably have been regularly paying rent or a car loan, so they will consider this to be evidence of being able to make regular repayments.

Lots of home loan lenders are being very strict when it comes to lending money to borrow using the excuse of the Royal Commission or changing lending policies, and this could be one of the reasons you have been knocked back…. But it’s worth remembering that not all banks are the same! They all have different lending policies, and if you are working with an experienced Mortgage Broker, you will be able to find a lender that will work with your situation.

If you’re looking to understand why your Home Loan might be Declined, have a look through the 9 reasons the banks knock back home loans. 

9 Things Banks Look For In A Home Loan

 

The ultimate person a bank is looking for is saving a few hundred dollars a week – their account balance is going up – and they are making more than the minimum repayment on their debts (like credit card/s).

This regular savings/debt repayment is known as ‘genuine savings’ in the banking industry, and it is exactly that – money that has been regularly put aside. Banks will look at your bank statements to see if you are actually doing this.

Things that are considered Genuine Savings include:

✅ Savings held or accumulated over 3 months
✅ Shares or managed funds held for 3 months or greater
✅ Equity in real estate or property
✅ Term deposits held for 3 months or greater
✅ First Home Super Saver Scheme (FHSSS)
✅ Some lenders allow exceptions if rent has been paid for the last 3 months or greater

And to be clear, the banks want to see you have held your savings for at least a few months. So, the following items do not count as genuine savings if they haven’t been held in your bank account for at least three months:

❌ Gifts from Parents or relatives.
❌ Inheritance from other family members.
❌ Refunds from tax returns.
❌ Bonus income from work.
❌ Sale of your assets like cars.
❌ First Home Owners Grant (FHOG) or Great Start Grant.
❌ Money held in a business banking account.
❌ Money from personal loans, credit cards or borrowed sources.
❌ Incentives paid from property developers, or builders.

Now a quick tip here: If you’ve held any of the above funds in your bank account for three months or longer this can be considered as genuine savings. For example if you sold your car six months ago and the money has been in your account for the last six months, this will be counted as genuine savings. But if you’ve sold it only in the last month, then it won’t count until you’ve held the funds in there for three months or longer.

9 Things Banks Look For In A Home Loan

 

Given that the Grant is a one-off payment, it is not considered genuine savings on your behalf.

This means (in addition to the Grant) you need to save money and / or show you are making regular repayments. But the simple answer to this question is: YES! Yes, you can use the First Home Owner Grant as part of your deposit but you will usually need to have existing savings as the grant alone is rarely enough to cover a deposit.

If you don’t have any existing savings you can ask a parent to act as a guarantor on your loan. Learn more about guarantor loans here.

BONUS: What Other Incentives Am I Eligible For In QLD? 

 

That’s right! As a Queensland resident, you could be eligible for not just the $15,000 First Home Owners grant but also several other incentives. These include the Stamp Duty Rebate and the recently announced First Home Loan Deposit Scheme, which we’ll cover below. But as a simple graphic, see below everything you could be entitled too in your first home purchase.

1. Stamp Duty Concession:

The Queensland Stamp Duty Concession is where a First Home Buyer can save up to $8,750 in buying costs when purchasing their first home in QLD. This acts almost like a rebate for the stamp duty you would normally pay when buying a property.

To find out how much Stamp Duty you would need to pay on your property, you can use the link here.

As stamp duty can be a substantial additional cost when buying a property, the Queensland government has decided to help first home buyers out by giving them a concession on all or part of the cost of the stamp duty.

As usual, you must meet eligibility criteria to qualify for the concession – namely, it is only available when buying an established home valued at under $550,000 or a block of land valued at under $400,000.

Some other criteria include:

To apply, simply speak to your broker and make sure your solicitor or conveyancer completes these forms for you. 

Then you can apply using the link here.

2. First Home Guarantee Scheme 

The First Home Guarantee Scheme, formerly the First Home Loan Deposit Scheme (FHLDS), has been designed to help eligible first home buyers get into the property market sooner.

 In the 2022 Federal Budget, the government renamed the First Home Guarantee scheme, previously called the First Home Loan Deposit Scheme. Places in the scheme have been expanded to 35,000 guarantees per year from the 2022/23 financial year, up from 10,000 places annually.

The scheme allows eligible first home buyers to purchase a property with as little as a five per cent deposit and without the need to take out lenders mortgage insurance.

The Commonwealth Government guarantees the difference between what the eligible first home buyer has saved and the 20% deposit threshold lenders usually require before they’ll provide a loan without LMI.

For instance, if you have $45,000 to put towards a $500,000 home, the government would step in and guarantee the first $55,000 of your loan so that it brings your security up to $100,000, or 20% of the total value of the property, excluding government fees like stamp duty. In this sense, the First Home Loan Deposit Scheme has a similar effect to a family guarantee but with the government playing the role of guarantor over the loan instead of a family member.

While the scheme doesn’t offer a cash payment, the good news is that you can use it in conjunction with any other government grants, schemes, concessions and waivers you qualify for. For instance, any First Home Owner Grant or stamp duty concessions you qualify for in Queensland.

From 1 July 2022, the scheme will be expanded to 35,000 places per year, ongoing, for the purchase of both new and existing homes. We cover this further in the below video for you – 

 

In 2022, to be eligible for the First Home Guarantee Scheme, there are only a couple of criteria (that we know of at this stage – of course, as more information is announced, we will update this as necessary). As it stands, the criteria for the scheme are as follows:

1. Property requirements
Both newly-built and established properties qualify for the First Home Guarantee scheme.

There are thresholds on the value of the property a recipient can purchase. These vary depending on which State or Territory you’re located in, but for Queensland, it is $600,000 (in metropolitan capital cities and regional centres) and $450,000 in the rest of the state.

For the scheme, a regional centre is defined as any centre with a population greater than 250,000. For example, this would include locations such as Gold Coast and the Sunshine Coast for reference.

2. Buying as a single or couple

You can qualify for the scheme as an individual buyer or as a couple. To be eligible as a couple, you need to be married or in a de facto relationship. Unfortunately, you’re not eligible if you’re buying with people you have a different relationship with, such as a parent or grandparent, sibling or friends.

3. Salary threshold

If you’re purchasing a home on your own, you need to have earned $125,000 or less in the last financial year (as declared in your ATO Notice of Assessment) to qualify for the First Home Guarantee (formerly First Home Loan Deposit Scheme). If you’re purchasing as a couple, you must have had a combined taxable income of less than $200,000 in the last financial year.

4. How much deposit do you need to have saved?

You’ll need to have saved at least a 5% deposit available to purchase your first home to be eligible. The government says these need to be ‘demonstrated savings’, which means you won’t be able to count any First Home Owner Grant money towards this deposit.

5. Principal and interest loan

Your loan usually needs to be a principal and interest home loan for the entire guarantee period. The only exception here is if you’re taking out a loan for both vacant lands or to construct a new home. In these circumstances, interest-only loans are eligible while your home is in construction.

Watch the video to the right for more information about the difference between principal and interest and interest-only home loans.

6. Owner/Occupiers Only

Finally, the scheme is only open to owner-occupiers, so you’ll need to be purchasing the home to live in it and not for investment purposes.

So the real question: If you are eligible, how do you apply for the new Scheme?

You must apply for the Scheme through a participating lender through your mortgage broker. 

A full list of participating lenders can be found on the National Housing Finance and Investment Corporation’s (NHFIC) website.

To apply to the Scheme, you’ll be subject to the above eligibility criteria, and you will need to be able to provide documentation of your eligibility to secure your position. As always, though, for any questions you may have, reach out to our Mortgage Expert team, and they’ll be able to assist.

Would you like to learn about your situation?
Check if you qualify for a loan

CHAPTER 2:

What are the first home owners grant rules in Queensland?

Wanna know the rules for applying fo the first home owners grant?

In this chapter we look at how to get the $15,000 first home owners grant, criteria and if you can use it as a deposit towards your next home.

Let’s jump right in!

 

QLD First Home Buyers Grant Rules: a Dead-Simple Explanation

How do I get the $15,000 great start grant?

There are a few rules when applying for the first home owners grant in Queensland that you and your partner or spouse need to meet.

The most important qualifying rule for the first home owners grant is that you have never owned a property, or a part of a property in your personal name in Australia before.

If you are purchasing a brand new home, it needs to be valued less than $750,000 and the property cannot have been lived in before.

 

On the other hand, if you are building a new home you need to purchase the block of land as per normal, and then when signing the building contract (learn more on our How to build a home guide) the value of the home including the land needs to be less than $750,000.

In both cases, you also need to live in the property as your main home for at least 6 months straight within the first 12 months of owning (or building) it.

 

According to the Queensland Government, to be eligible for the Great Start Grant (now referred to as the first Homeowners grant) you must:

  • ✅ You must be at least 18 years of age.
  • ✅ You must be an Australian citizen or permanent resident (or applying with someone who is).
  • ✅ You or your spouse must not have previously owned property in Australia that you lived in.
  • ✅ You must be buying or building a brand new home.
  • ✅ The value of the home including the land is less than $750,000.
  • ✅ You must move into the new home as your principal place of residence within 1 year of the completed transaction and live there continuously for 6 months. 

Can a First Home Buyer Grant be Used as Deposit?

Some more good news is yes, you can use your $15,000 first home buyers grant towards your deposit.

That’s the great part about the grant, it allows you to start building faster or purchase a property much quicker.

The only caveat is that not all banks will consider the first home buyers grant as genuine savings, so you may need to contribute some extra cash towards your deposit which can be a few thousand dollars depending on the build price.

If you are going to be using the Grant in 2022 as part of your deposit when buying a brand new or substantially renovated home, I would recommend speaking to one of our Mortgage brokers first.

We help lots of first home buyers with getting a great deal on a loan, and guiding you through the steps to buy your home, or even help with building a home including:

  1. ✅ Finding, and buying your block of land
  2. ✅ Getting your builder’s contract signed, and what to look for (and what to look out for)!
  3. ✅ Helping get your home loan approved, we calculate what you can afford to pay each week and arrange a bank valuation for you at no cost to you!
  4. ✅ Managing payments to the builder from the bank, to make sure your home is built quickly and easily.

The reason for this is best explained using an example. Let’s say you purchase the home for $600,000; then you would need a minimum 6% deposit (plus buying costs):

  • Minimum deposit required on $600,000 purchase: $36,000 (6%)
  • Plus buying costs: $18,200
  • Total deposit required: $54,200

You can use the Grant to help fund the $54,200 deposit required.

  • Total deposit required: $54,200
  • Less Grant: $15,000
  • Deposit you need to save yourself: $39,200

In this example, you would need to save $39,200 to go towards your deposit. But this number can easily change based on your specific circumstances. I can calculate these figures exactly for you, so if you would like to understand how much deposit you need to buy a place, speak with one of our mortgage brokers in Brisbane.

nathan vecchio hunter galloway mortgage broker ashgrove Nathan Vecchio is one of our senior mortgage brokers at Hunter Galloway.

CHAPTER 3:

What could make me ineligible for the $15,000 first home owners grant?

You can take our eligibility tester to see if you can apply for the $15,000 home owners grant.

The rules of the first home owners grant to apply to both you as the applicant, your age, residency status if you have received the grant before and the type of property you are looking at buying or building.

Let’s walk through what can make you ineligible for the grant. 

Step by step.

 

1. Previous home ownership

The first home owners grant was created to help people into their first home, so you cannot have owned (or partially owned) property in your personal name previously.

This also applies if you are buying your first home with your spouse, or partner, they are not allowed to have owned property before in Australia.

Brisbanes surbubs Teneriffe If you’ve owned property before and lived in it you may not qualify for the first home owners grant.

Unfortunately, if your partner has owned a property before and they fall under the Queensland Government’s definition of partner (you are married, or living together on a ‘genuine domestic basis’ for 2 years or more) you may not be eligible for the $15,000 first home buyers grant.

If this is the case while you might not be able to apply for the $15,000 grant, you might still be able to apply for a stamp duty rebate.

2. The type of property

This is the one that usually catches most people. To qualify for the first home owners grant QLD you need to be buying a brand new home, or building a new home – it does not apply on existing properties or ones that have been lived in before.

The trickiest part of this is defining a substantially renovated home. In short, a substantially renovated home has had serious structural changes made, it was basically a knockdown and completely rebuild and all renovations need to happen before you buy it.

home loan guide to brisbane The type of property affects if you will receive the first home owners grant QLD.

The Queensland Government defines substantially renovated properties as involving structural building work such as:

  • 🏗replacing or altering foundations
  • 🏗replacing or altering floors or supporting walls (interior and exterior)
  • 🏗lifting or modifying roofs
  • 🏗altering brickwork to replace existing windows and doors

They do not consider a home to be substantially renovated if only cosmetic work like painting has been done, or a new kitchen has been put in for example.

3. Your property purchase value

Regardless of buying a brand new home, or building one the total value of the property needs to be under $750,000 to be eligible for the grant.

The only complexity with this is if you are building, where the total costs of your land added to your building costs (plus any additional variations like fences, solar panels, landscaping, etc) need to be under $750,000.

Put another way, if you paid $350,000 for a block of land, the build price was $400,000 and landscaping cost $50,000 your total purchase price or property value would be $800,000 and you would be ineligible for the grant.

building a home with bad weather To qualify for the first home owners grant QLD your property needs to be valued less than $750,000.

On the other hand, if you paid $200,000 for your land and total build price was $244,000 your total property value would be $444,000 and you would be eligible for the $15,000 first home owners grant.

4. Your age and need to be an Australian Citizen (or permanent resident)

To qualify for the first home owners grant in Queensland you need to be at least 18 years old, and you (or your partner) needs to be an Australian citizen or permanent resident. In either case, as with point 1, you and your partner cannot have received the Queensland First Home Owners Grant or any other home ownership grant in Australia.

First Home Owner Grant – Case Study

In order to get a better understanding of the entire process, let’s take a look at an example. Suppose, you and your partner currently live in a rented apartment and planning to buy your first home. You are trying your best to save as much money as you can and be eligible for a $15,000 first home owner grant.

Different types of properties, including off-the-plan, under-construction property, and a new house (construction completed) can qualify for first home buyers grant.

Below are the eligibility criteria for these properties:

  • ✅ Off-the-plan – It includes the projects where no construction has taken place yet but they qualify for construction.
  • ✅ Under Construction – It includes those properties where the construction is still underway and not yet completed.
  • ✅ A Newly Constructed Property – You will qualify for a $15,000 grant if the construction of the property has been newly completed. In addition to that, you also fulfil the criteria of first home buyers grant.

So far, you have saved $20,000 and plan to secure at least a 5 per cent deposit. Suppose, you plan to buy the second option (under construction) for $460,000, then you need to save $3,000. If you manage to save the required deposit and sign the agreement before the year ends, you become eligible for the grant.

Chat to Hunter Galloway today about how we can sort out your financing for the First Home Owners Grant on 1300 088 065 or email Nathan at here.

What other options are there for first home buyers?

If you have not owned property before you could be eligible for the First Home Super Saver Scheme. This allows you to make extra payments to your superannuation account, and in effect helps you save money for a deposit faster as you pay less tax.

First Home Super Saver Scheme (FHSSS)

Read More: First Home Super Saver Scheme | Step-by-step Guide 🎉

In 2022, this First Home Super Saver Scheme was announced and could help you use your superannuation as part of your home loan. This will allow first home buyers to save faster with the concessional tax treatment of superannuation.

From 1 July 2022, first home buyers can make voluntary super contributions of up to $50,000 into their super, then withdraw this amount to form their deposit on their first home. Only voluntary contributions can be accessed as part of this scheme. You can watch our detailed breakdown on the proposed scheme here.

 You can use this scheme if you are a first home buyer and each of the following apply:

  • You will occupy the premises you buy, or intend to as soon as practicable. So Owner Occupiers ONLY!
  • You intend to occupy the property for at least six months within the first 12 months you own it (after it is practical to move in).
  • The home you purchase or construct must be located in Australia

You can currently apply to have a maximum of $15,000 of your voluntary contributions from any one financial year included in your eligible contributions to be released under the FHSS scheme, up to a total of $30,000 contributions across all years.

However, from 1 July 2022, the amount of eligible contributions that can count towards your maximum releasable amount across all years will increase from $30,000 to $50,000. The amount of eligible contributions that can count towards your FHSS maximum releasable amount for each financial year will remain at $15,000.

 To be eligible, participants must:

  1. ✅  Be an Australian citizen aged 18 or over
  2. ✅  Never have owned property in Australia
  3. ✅  Have not previously had funds released from superannuation under this scheme

Is it possible to have the grant taken off you?

Yes, we have seen cases where you can qualify for and get paid the grant but if you do not abide by the rules the government can force you to repay the grant.

You just need to understand your obligations in receiving the first home owners grant and make sure you:

  • ✅ Move into the home within 1 year of buying it
  • ✅ Live in the home as your principal place of residence for 6 months continuously
  • ✅ Tell the office of state revenue within 14 days if you are unable to move into the home, or have to move out of the home before you have lived there for 6 months continuously

So just be aware of the conditions of the first home owners grant, and if you stick to them you’ll be fine! If you aren’t sure about your situation you can speak with our team, or call the Office of State Revenue on 07 3179 2500.

There are a few simple conditions of the first home owners grant that you need to be aware of.

CHAPTER 4:

Can you get the First Home Buyers Grant on established homes? 

If you are a first home owner in Queensland looking at buying an established home, you would be ineligible for the $15,000 first home owners grant.

But you are able to claim the first home concession for transfer duty (also known as stamp duty)!

So while you might not receive the first home owners grant, you can save up to $8,750 in stamp duty concessions as a first home buyer on established home purchases up to $500,000.

How much do you save with Stamp Duty Concessions?

First Home buyers then pay a concessional stamp duty amount on purchases up to $550,000 and then over $550,000 there are no additional concessions or discounts.

This can be on both established units, and existing houses, here are a few examples.

Purchase Price 🏡
Stamp Duty (also known as transfer duty) 
Stamp Duty Paid by First Home Buyers
Amount Saved on Stamp duty with rebate 
Up to $500,000
$8,750
$0
$8,750 💸
$525,000
$9,625
$5,250
$4,375 💸
$550,000
$10,600
$10,600
$0
$600,000
$12,850
$12,850
$0
$650,000
$15,100
$15,100
$0
$700,000
$17,350
$17,350
$0
 

What are the rules with the First Home Owners Transfer Duty Concession?

The requirements of the first home owners transfer duty concession are slightly different to the first home owners grant, so you need to be aware not to get caught out.

For example, with the first home owners grant you need to live in the property for 6 months continuously within the first 12 months of moving. And then if you want you can move out, rent the property, sell it etc.

With the First Home Concession, you cannot dispose of (i.e. sell, must live there) or rent out any room in the property for 1 year.

So if you qualified for both the First Home Owners Grant, and the First Home Concession you need to be aware that you need to live in the property for at least 1 year, and cannot rent out any rooms (including AirBNB ) to ensure you do not get caught out and lose your concession or grant.

If you aren’t sure about your situation get in touch with our team of First Home Buying experts to chat about your situation or call us on 1300 088 065.

new farm mortgage broker

Read More: 11 Hidden Costs when Buying a Home in Brisbane

CHAPTER 5:

How do I apply for the first home owners grant?

If you apply for a home loan through us we will help you complete the application for the $15,000 first home buyers grant along with all the supporting documentation.

When you apply for the Queensland First Home Owners Grant you will need to provide your supporting documentation like your contract of sale, along with the original application form (you can also download the First Home Owners QLD form here.)

In this section, we’ll walk you through what needs to be completed to get your $15,000 grant FAST! 

 

How do I complete the first home owners grant application form?

If you work with Hunter Galloway we’ll help you complete the First home owners Grant application form as a part of your home loan application.

We will help you fill out, and complete the paperwork to make it super easy!

The total First Home Buyers Application Form is 15 pages long, and has 7 main sections:

Section 1: Eligibility Criteria

The first section of the First Home Buyers Application form for the Queensland First Home Owners Grant checks that you are able to apply for the grant.

As you can see from the example below, a qualifying first homeowner will answer yes to questions 1 to 7, and then no for questions from 8 onwards.

First Home Owners Grant Application Section 1 Section 1 of the First Home Owners Grant application form has the qualifying questions.

Section 2: Applicant Details

This section of the application form has all your basic personal information, name, address, contact details all the simple stuff for both you, and your partner. If there are more than 2 applicants you can just add an additional form.

Section 2 of the First Home Owners Application in Queensland has your basic contact information.

Section 3: Spouse Details 

Section 3 is only there if you have a partner or spouse who is not an applicant that you detailed in section 2. If you do not have a partner or spouse you can skip this section and continue to section 4!

First Home Owners Grant Application Section 3 You’ll be happy to know Section 3 of the First Home buyers application form can be skipped if you are not applying with a partner or spouse.

Section 4: Property and Transaction Details 

In section 4 you will need to include the details of the property you are purchasing, or building as well as the type of property.

First Home Owners Grant Application Section 4 Section 4 of the First Home Owners Grant Application QLD has the property details.

The options in section 4 include the below, only choose 1 option.

  • Contract to purchase a new home
  • Contract to purchase a substantially renovated home
  • Contract to build
  • Contract to purchase off-the-plan
  • A building as an owner-builder

Buying off the plan means you are purchasing a property before the building is out of the construction phase, and the title has yet to be created.

If you are buying off the plan it means the property is not completed yet, so if you have bought a new property that is ready to be moved into you can choose ‘contract to purchase a new home’.

Section 5: Optional Information

As the name suggests this is not a mandatory section, and only applies if you are Aboriginal or a descendant from the Torres Strait.

Section 6: Declaration by Applicant 

This section is where you need to sign the application form, and it needs to be witnessed by someone who isn’t an application.

First Home Owners Grant Application Signature This section of the First Home Owners Grant QLD application form is for signatures.

Put another way, if you and your partner are applying for the grant your partner cannot witness your signature and vice versa. Lucky for you, because you are working with our Mortgage Brokers at Hunter Galloway we can witness your signature.

Section 7: Declaration by Spouse 

When you are applying with a partner or a spouse, this is the section that they sign. Same as the above, their signature needs to be witnessed by someone that isn’t you.

Frequently Asked Questions – Made Simple.

How much is the First Home Owners Grant QLD?

As a first home buyer in Queensland you could be entitled to the $15,000 First Home Owner Grant (FHOG). To be eligible for the FHOG QLD, you need to buy a brand new home or build a home from scratch. The value of your first home including the land, must be below $750,000.

First Home Owners Grant QLD eligibility

To be eligible for the First Home Owners Grant in QLD, you must:

✅  To be eligible for the First Home Owners Grant in QLD, you must be:
✅  A natural person (not a company or trust) aged 18 years or older.
✅  An Australian citizen or permanent resident (or applying with someone who is).
✅  You need to be a permanent resident or Australia citizen.
✅ You or your spouse must not have previously received a First Home Owner Grant in Australia.
✅ You must not have previously owned property in Australia that you lived in.
✅ You may still be eligible for the First Home Owner Grant in Queensland if you have owned an investment property as long as you haven’t lived in it.

How to apply for First Home Owner Grant QLD

Applying for the First Home Owner Grant is easy, and your Mortgage broker can guide you through the paperwork. Contact us here for assistance.

Are first home buyers in QLD exempt from stamp duty?

As a first home buyer in QLD, you may be eligible to save on the cost of stamp duty. You can read more here.

But generally, if you’re buying vacant land to build your first home, you pay zero stamp duty as long as you pay $400,000 or less for your block. That’s a saving of $7,175 on the regular cost of stamp duty.

If your first home is valued at up to $500,000, you pay zero stamp duty. That saves up to $15,925, which is the maximum stamp duty rebate available to first home buyers in QLD.

Additionally, savings on stamp duty may still be available if you pay between $500,000 and $550,000 for your first home. As a guide, if your first home is worth $530,000, you pay stamp duty of $6,300 and save $3,500. These savings cut out altogether if your first home costs $550,000 or more.

Can you get the First Home Owners’ Grant if you’re married?

Marriage in itself is not a barrier to the First Home Owners’ Grant application being successful. That said, if your spouse does not meet the criteria for the grant, then it may not be awarded.

Can you get First Home Owners’ Grant on existing homes?

Generally, the answer to this question is no. The vast majority of First Home Owners’ Grants are given out to people who are buying a new-build property for the first time or who are building their own property for the first time. In some circumstances, a grant can be awarded on an existing home, where extensive refurbishment or remodelling has taken place to make the dwelling fit for habitation. These are judged on a case by case basis. For more information, contact your Mortgage Broker.

How long does a First Home Owners Grant QLD application take to process?

Once you submit your application with all the required information, it will be processed within ten working days. Tip: If you apply through your mortgage broker and an approved bank or financial institution, you may get the grant sooner.

When does the First Home Owners’ Grant get paid to successful applicants?

The new home owners grant is paid across at different points in the purchasing transaction, depending on whether your new home owners grant is for a new-build constructed by a developer or whether you are building your own property (or having it built for you by a builder as a one-off project).

For a first time new-build purchase from a developer, the grant is paid on completion of the sale.

If you are building your own property, the government grant for first home buyers is paid across once construction has actually begun on site.

What if I am unable to stay in the property and would prefer to rent out my property?

You are expected to move into your new home within one year of purchase and reside there for a minimum continuous six month period. If you have to move out during this time, the government may request that you pay back the grant.

First Home Owners Grant Criteria differences by state and territory

There are some variations in the eligibility criteria for each state or territory you live in, including:

• Australian Capital Territory:

Since 1 July 2019, the ACT no longer offers First Home Owner Grants. Instead, the territory has extended the stamp duty exemptions and concessions it offers. For more information, contact your broker.

New South Wales:

Criteria for NSW is similar to QLD, but includes the following elements:

✅ The contract date, when the contract to buy or build is signed, must be on or after 1st January 2016.
✅ The value of a newly constructed or substantially renovated home should be less than $600,000
✅ The combined value of the land for building and any dwelling intended to be built must be $750,000 or less.
✅ Applicants must live in the home for at least 6 months.
✅ Applicants must not have occupied and held relevant interest in the same property in Australia for at least 6 months after 1st July 2000.

For more information, contact your broker.

Northern Territory

Applicants must not have occupied and held relevant interest in the same property in Australia after 1st July 2000. For more information, contact your broker.

• South Australia

✅ Applicants must enter into a contract on or after 17 September 2010.
✅  All applicants must live in the home for at least 6 months, starting within 1 year of the completion of the transaction.
Applicants must not have occupied and held relevant interest in the same property in Australia for at least 6 months after 1st July 2000.

For more information, contact your broker.

• Tasmania

✅ Applicants must live in the home for at least 6 months, starting within 1 year of the completion of the transaction.
Applicants must not have occupied and held relevant interest in the same property in Australia after 1st July 2000.

For more information, contact your broker.

• Victoria

✅ The value of the property must be $750,000 or less.
✅ At least 1 applicant must live on the property for at least 1 year, starting within 1 year of the completion of the transaction.
✅ Applicants must not have occupied and held relevant interest in the same property in Australia for at least 6 months after 1st July 2000

For more information, contact your broker.

• Western Australia

✅ All applicants must live in the home for at least 6 months, starting within 1 year of the completion of the transaction.
✅  Applicants must not have held relevant interest in a property in Australia after 1st July 2000 and occupied the same property for at least 6 months after 1st July 2004.

For more information, contact your broker.

BONUS:

First Home Buyers Scheme – 95% No LMI government grant?

The First Home Loan Deposit Scheme is now available and allows home buyers with between a 5-19% deposit the chance to get a guarantee from the government, and avoid Lenders Mortgage Insurance saving you tens of thousands in extra fees!

There are some restrictions around income, property price and your citizenship status in this chapter we give you everything you need to know about the First Home Loan Deposit Scheme in 2020.

Did you say free money from the government?

 The First Home Loan Deposit Scheme is an Australian Government initiative to support eligible first home buyers purchase their first home sooner. 

The government’s scheme is designed to allow easier and faster access to the property market for first home buyers. Initially starting in 2020 as the First Home Loan Deposit Scheme (FHLDS) – now renamed The First Home Guarantee – allows first time buyers the opportunity to purchase a home with a deposit of as little as 5%, while avoiding lenders’ mortgage insurance (LMI).

Most banks and lenders require a minimum deposit of 20% of the property’s value for the borrower to be exempt from LMI. The scheme allows first home buyers who can’t reach this threshold to take out a loan if they have saved at least 5% of the value of the property they are buying. The government will underwrite the loan so that borrowers do not have to pay LMI. 

Exciting increases have been announced in the 2022-23 Federal Budget, allowing more first home buyers access to this scheme! The First Home Loan Deposit scheme has now been officially renamed the First Home Guarantee and from 1 July 2022 – 30 June 2025, the number of placements for the low deposit scheme will increase to 50,000 spots. After this three year period the number of placements will then revert to 35,000 per year. 

During this 3 year period, the 50,000 spots will include the following breakdown

  • ✅ 35,000 places per year for the First Home Guarantee for eligible first home buyers to enter the market with a 5% deposit and no LMI.
  • ✅ 5,000 places per year for the newly announced Regional Home Guarantee for eligible home buyers to purchase a new home in a regional location with a 5% deposit and no LMI.   
  • ✅ 10,000 places per year for the Family Home Guarantee , for eligible single parents buying a home with a 2% deposit and no LMI. 

first home buyer scheme 2020 While the obvious positives to the scheme are helping first home buyers save tens of thousands in Lenders Mortgage Insurance costs, there are some potential downsides.

  • ⛔️ The government scheme will be restricted to 10,000 first home buyers each year, which as an example only works out to be 10% of the total 110,000 first home buyers in 2022.
  • ⛔️ Smaller Deposit Risk. There is a risk in taking out a loan with a smaller deposit, since the amount left owing is obviously going to be larger. Because of this, your mortgage might end up lasting longer than it otherwise would. 
  • ⛔️ You Pay More Total Interest Over The Course Of Your Loan. The other drawback of the government’s home ownership scheme is that borrowers will have to pay more total interest over their loan. Since the deposit will be smaller, the amount against which interest is calculated will be greater. 
  • ✅ The guarantee is set to last as long as you hold your property, or until you refinance your property
  • ✅ It can save you tens of thousands, as an example a $400,000 purchase with a 5% deposit would normally cost between $13,047 and up to $17,512 in LMI.

The other unknown is how this new first home buyers grant could create more demand and push prices up for first home buyers. According to research by the Deakin University:

In 2010 the First Home Owners Grant was increased by $7,000 to $14,000 for an existing home and increased to $21,000 for a new home. Since the introduction of First Home Owners Grant, property prices have directly increased by over $57,321 or 18.8% since its introduction.

So it’ll be interesting to see how it plays out, but worth keeping all of this in mind if you are trying to decide if its best to wait or buy your first home.

How does it work?

You will need to apply for the scheme through one of the scheme’s participating lenders, or authorised representatives such as our Mortgage team, and demonstrate your eligibility.

If you are approved, you can then take out a home loan with a lender and the government will act as your guarantor. Although your lender will still do their normal checks on your financial situation, this will make it easier to get a loan without having saved for a 20% deposit. If you take out a home loan under the scheme, you will then receive support until your loan’s balance is reduced to below 80% of the value of your property at purchase. However, if you refinance your loan, sell your home or move out, you will no longer be eligible for support.

If you are refinancing your home and you still owe more than 80% of the value of the property, you will likely need to pay the fee for lenders’ mortgage insurance with your new lender. 

Who is eligible for the Scheme?

You will need to meet some eligibility criteria to qualify for the First Home Loan Deposit scheme including:

  • Australian citizens who are at least 18 years of age. Permanent residents are not eligible.
  • Single applicants with a taxable income of up to $125,000 per annum for the previous financial year and couples with a taxable income of up to $200,000 per annum for the previous financial year. For all Scheme applications made from 1 July 2021 to 30 June 2022, the relevant financial year assessed will be 2020-21.
  • Couples are only eligible for the Scheme if they are married or in a de-facto relationship. Other persons buying together, including siblings, parents/child or friends, are not eligible for the Scheme.
  • The Scheme assists single (individual) applicants and couples (together) who have at least 5 per cent of the value of an eligible property saved as a deposit. If 20 per cent or more is saved, the Scheme will not cover the home loan.
  • Loans under the Scheme require scheduled repayments of the principal and interest of the loan for the full period of the agreement (with limited exceptions for interest-only loans, which mainly relate to construction lending).
  • Applicants must intend to be owner-occupiers of the purchased property. The Scheme does not support investment properties.
  • Applicants must be first home buyers who have not previously owned or had an interest in a property in Australia, either separately or jointly with someone else (including residential strata and company title properties). 

 

There are also restrictions on the purchase price of the property which we have detailed here. In Queensland this remains $600,000 for capital cities (populations over 250,000 people or more) and regional centres. 

How do I apply? 

Eligible first home buyers can apply for the Scheme through our Mortgage team and they can help you apply through an applicable lender.

There are no costs or repayments associated with the Scheme guarantee. However, first home buyers are responsible for meeting all costs and repayments for the home loan associated with the guarantee.

For the 2021-22 financial year, 10,000 Scheme places will be available through participating lenders from 1 July 2021. NHFIC will not accept applications directly and does not maintain a waiting list for places under the Scheme.

Now It’s Your Turn

If you are looking to build a home in Queensland, or buy a new home using the first home owners grant our team at Hunter Galloway can help.

Our team here at Hunter Galloway helps first home buyers with navigating the home buying process.

To chat about your deposit, lending and first home ownership options book in a time to sit down with us, or feel free to call on 1300 088 065.

More Resources for first home buyers

Ready to take the next step toward buying? We’re happy to help. Schedule a call today with a Home Loan Expert from Hunter Galloway, the home of home buyers.

Schedule a call

The information on this page is general in nature and should not be considered as advice. Before you act on this information you must seek independent legal and financial advice.