If you are looking to buy a brand new or substantially renovated property in New South Wales, or wish to build your own home in the state, you may be eligible for a $10,000 grant from the NSW government.
The NSW First Home Owner Grant (FHOG) also offers stamp duty exemptions to ease some of the upfront costs and aid Sydney first home buyers to step on to the property ladder.
If you have already purchased your home, you may still be able to apply for this NSW first home buyer’s grant.
All you need to know about the NSW FHOG
Overview
Almost every state and territory in Australia offers grants to help first home buyers purchase their own properties. The size of these grants, eligibility criteria and types of applicable properties differ from one state or territory to the next.
The NSW FHOG scheme was first introduced in 2000 to help Sydney first home buyers construct or purchase brand new homes. The grant, which was $7,000 at the time of introduction, was intended to offset the cost of goods and services tax (GST).
Today, this once-off, tax-free subsidy amounts to $10,000, but there are strict conditions that need to be met.
Who can apply
In order to qualify for the NSW first home buyer’s grant, you or your partner must not have owned a home before 1 July, 2000, or previously received a first home owner grant in the country.
If, however, you owned a property before 2000 but did not live in it for more than six consecutive months, or own/owned an investment property you have never lived in, you may be eligible to apply.
Applicants must be at least 18 years old and purchasing the property as private individuals. In the case of co-applicants, at least one buyer needs to be an Australian citizen or permanent resident.
Types of properties
The NSW first home buyer’s grant is applicable to buyers of newly built properties – or those still under construction – that have never been lived in, or properties that have been substantially renovated but not lived in since renovations were completed. It is also available to Sydney first home buyers wishing to build their own homes.
If you are buying a new or renovated home, it needs to serve as your primary place of residence for at least 12 months. If you are constructing the property, you need to move in within 12 months of completion and live in the home for at least six months.
Price caps
● $600,000 for already-built homes or those under construction
● $750,000 for vacant land and construction costs
How much you can save
If you take out a $600,000 loan over a 30-year term, at an interest rate of 6.30% – the average rate of new variable-rate mortgages granted in February 2024 – this is how your repayments may look with and without the NSW first home buyer’s grant.
Without the NSW FHOG – $600,000 loan
● Monthly repayment: $3,714
● Total repayment: $1,336,981
With the NSW FHOG – $590,000 loan
● Monthly repayment: $3,652
● Total repayment: $1,314,698
The subsidy will save you $62 a month and $22,283 in total.
How to apply
If you require the $10,000 NSW first home buyer’s grant as part of your deposit, you can apply for it when you lodge your mortgage application. You can also apply for the subsidy after settlement.
There are two ways to apply:
1. Through a mortgage broker
While mortgage lenders can provide you with the application forms and documents and help you apply, it is a good idea to consult with a mortgage broker that can guide you through the process and offer additional advice and support.
A reputable and experienced mortgage broker can help you understand the criteria and obtain home loan pre-approval so they can manage the grant at settlement. They can also help you apply for your mortgage and the NSW first home buyer’s grant.
2. Directly at Revenue NSW
It is also possible to apply for the NSW FHOG directly with Revenue NSW, preferably within 12 months of your property settlement date. You will, however, need to self-manage your application, including applying online and collating and uploading supporting documentation.
If you apply for the grant more than 12 months after settlement, Revenue NSW will require additional documentation.
Boost your chances of approval
Once you know that you are eligible for the NSW first home buyer’s grant, you can improve your chances of approval by having the necessary documentation ready. Some documents will need to be certified.
A reputable mortgage broker, such as Loan Station, can give Sydney first home buyers clear direction on what documents they need according to the properties they own or plan to buy.
Required documentation may include a combination of the following:
● Proof of identity
● Photo and signature identification
● Proof of operating in the community, such as your Medicare card
● Proof of address
● Property sale or home building contract
● Proof of property ownership, such as a title deed search
● Proof that this is the first sale of the home
● List of renovations if applicable
● Occupation certificate, if buying a renovated home
● Evidence of land value
● Final statement from builder
Taking the first step
If you are eligible for the NSW first home buyer’s grant and want to buy a brand new home or build your own, Loan Station can help you apply for a mortgage, compare various offers and assist with your grant application.
Contact us today for personalised step-by-step guidance as well as advice on other government concessions Sydney first home buyers may be eligible for, including stamp duty discounts, low deposit loans and shared equity schemes.
