Buying your first home can be stressful. But being prepared ensures you won't take out a loan that you'll have trouble paying back, which can be the harsh reality for many first-time home buyers.
Thankfully the government can help. The First Home Super Saver Scheme (FHSS) was designed to help home buyers save into their super. And another governmental benefit for new purchasers is the First Home Owner Grant (FHOG).
Take a look at these two programs and how you could benefit from them.
First Home Super Saver Scheme
How does the scheme work?
The FHSS scheme was first implemented as part of the Federal Budget of 2017-18. Beginning 1 July 2017, you could start making contributions (either before or after tax) into your super fund specifically for first-home savings.
The annual cap of voluntary contributions is $15,000 and the total limit of release is $30,000 across all years, the Australian Taxation Office says.
The government's homeowner website indicates that you can save money for your first home 30 per cent faster by taking advantage of the scheme. The funds you invest into super will grow quicker than if you just saved the same amount on your own.
Who is eligible? Those who are over 18 may begin to access their super funds allocated toward the FHSS scheme, though there is no age requirement to start these contributions.
In addition, eligibility requirements include the following stipulations:
You have never owned property in Australia.
You have never previously requested, in relation to the scheme, a release authority from the Commissioner.
You will live in the home or intend to as soon as you can (for instance, after repairs).
You plan to live on the property for at least 6 months during the first 12 months that you own the home.
Note that couples who decide to buy a home together can benefit from the scheme even if one person has already owned a home.
First Home Owner Grant
How does the grant work and who is eligible?
The FHOG has been around since 2000 and helps first-time home owners offset the GST they will incur when purchasing a home. Although it's a national scheme, eligibility criteria vary by state. The amount awarded also varies by applicant and by state, the government's First Home website says.
The FHOG provides a one-time monetary grant to first-time home buyers that meet criteria in their state. These requirements can include the following stipulations:
You must be 18 or older.
You have never received the grant before in Australia.
One or more applicants must live in the home for at least a year.
The property value must be under $750,000.
When you're preparing to purchase your first home, it's smart to take advantage of these two government schemes, even if that means starting to plan early. To discover more about home loans in Australia and the benefits available to first-time buyers, speak to our team today on 0419 898 898