First Home Buyer Schemes & Grants available to residents of NSW

April 3, 2023

Welcome to the LINK blog for April 2023.

The housing supply constraints being experienced in New South Wales have been well documented in the media over the last 18 months. There are many factors contributing to this including the large uptick in skilled migration to Australia, lower commencements and completions, as well as ongoing pressures on the construction industry.

The conditions are only set to become more challenging. The case for owning an apartment over renting is stronger than ever.

To that point, this month's blog will recap LINK's first-home-buyer presentation brought to you by Ben Hamblett. The wide-range of First-Home Buyer's grants available to consumers in New South Wales.

There are currently 5 schemes or grants available to First-Home Buyer's in New South Wales. This information is current as of April 2023 and is likely to change as the new government's initiatives are integrated into the system - but we'll be sure to keep an eye on any developments.

  1. NSW First Home Buyer Assistance Scheme (Stamp Duty)​

For new homes consumers can buy a new home valued at less than $650,000, apply for a full exemption, and pay no transfer duty.​ Alternatively, a first-home buyer can purchase a new home valued between $650,000 and $800,000, and apply for a concessional transfer duty rate. The amount will be based on the value of your home.

For existing homes, first home buyers can purchase an existing home valued at less than $650,000, apply for a full exemption and pay no transfer duty.​ Or, buy an existing home valued between $650,000 and $800,000, apply for a concessional transfer duty rate. The amount will be based on the value of   your home.​

For Vacant land You won’t pay transfer duty if your land is valued at less than $350,000, however, for land valued between   $350,000 and $450,000, you’ll receive a concessional rate.​

  1. NSW First Home-Owner (New Homes) $10,000 Grant​

A $10,000 First Home Owner Grant (FHOG) is available when you buy or build your first new home - however there are some conditions. If you purchase a newly built house, townhouse, apartment, unit or similar the purchase price must not exceed $600,000.​
If you purchase vacant land and sign a building contract with a builder then the value of the vacant land plus the value of the comprehensive home building contract plus the cost of any building variations are combined together. The total combined cost must not exceed $750,000.  

  1. NSW Shared Equity Home Buyer Helper Scheme (2% Deposit)​

The NSW Shared Equity Home Buyer Helper assists eligible single parents (with dependent children), single people (50 years and over) and first home buyers who are employed as key workers with buying a home.​ The NSW Government will pay up to 40% of the purchase price of an eligible property, retaining it as equity for as long as you are eligible for Shared Equity or until you sell the property.​

Payments or rent aren’t required on the Government’s equity interest in the property while you remain eligible for Shared Equity.​ However, there is some ongoing eligibility criteria​ you should be aware of. Firstly, You must be an Australian citizen or permanent resident and remain so to be eligible.​ Your household income must not exceed the income threshold for two consecutive financial years.​ You must not own any other land or property, apart from the one you purchased with the government equity contribution.​ Finally, you must continue to occupy the property as your principal place of residence or apply for an exemption if you are in hospital, or need to vacate for renovations, or for other reasons permitted with approval.​

If you are no longer eligible, you may need to start buying back the NSW Government’s interest in the property, however, your individual circumstances will be considered when making this determination.

  1. NSW First Home Buyer Choice Scheme (Stamp Duty)​

First Home Buyer Choice now provides first home buyers purchasing properties for up to $1.5 million the ability to choose to pay an annual property tax instead of transfer duty. The property tax will only be payable by first home buyers who choose it, and will not apply to subsequent purchasers of a property.​
This is a huge saving in upfront costs of purchasing a property and depending on how long you keep the property can save you money.

  1. Australian Government: First Home Guarantee (5% Deposit)

Under the FHBG, part of an eligible first home buyer’s home loan from a participating lender is guaranteed by NHFIC. This enables an eligible home buyers to purchase a home with as little as 5% deposit without paying Lenders Mortgage Insurance.

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Ben Hamblett
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