All the signals are right if you are a first home buyer living in Australia. At no previous time has a first home buyer had access to a number of cash subsidies and savings that have resulted firstly from individual state government initiatives and secondly from initiative by the Federal Government to encourage first home buyers back into the market. By providing generous subsidies and grants it is hoped that more first home buyers will be out and about looking for a new home and this will provide the stimulus for increased construction activity in the home sector.
In NSW the state government introduced a New Home Buyers supplement Effective from 11 November 2008. Under this arrangement a NSW First Home Buyer who is purchasing a newly constructed home will receive a Supplement of $3,000.
This will be will be added to the existing $7,000 grant for eligible First Home Owner Grant applicants building a new home or buying a newly constructed home. For the time being, the $3,000 Supplement will only be available for 12 months (11 November 2008 to 10 November 2009 inclusive), at which time it will be reviewed in the context of the property market. One can probably assume that if the global crisis continues beyond November 09 then the first home buyer supplement will be extended for a further period.
This first home buyer supplement is on top of the $14,000 provided under the Commonwealth’s First Home Owner Boost scheme. This will give eligible First Home Owner Grant applicants i.e. first home buyers building a new home or buying a newly constructed home a total of $24,000 towards the cost of their new acquisition.
Effective from 1 July 2009 (still subject to Federal Government approval) the First Home Owner Grant and NSW New Home Buyers Supplement will be capped and only be available for properties valued up to $750,000. This is likely to include the majority of first home buyer purchases and is a terrific incentive for first home buyers to enter the market. Other Australian states also provide incentives at State level to first home buyers – the Commonwealth ‘boost” scheme obviously applies to all states and territories.
To date the most funding under the first home buyer schemes in NSW has gone to Liverpool ($98 million +), followed by Campbelltown ($70m +) Wentorthville (69m+) and Blacktown ($63m+). In NSW as at 8th January a total of $5 billion has been paid in subsidies and grants to first home buyers. These subsidies for first home buyers include:
· $7000 additional grant for new homes where contracts were signed between 9 March 2001 and 31December 2001
· $3000 additional grant for new homes where contracts were signed between 1 January 2002 and 30June 2002
· $7000 Boost Payment for established homes where contracts were signed from 14 October 2008
· $14 000 Boost Payment for new homes where contracts were signed from 14 October 2008
· $3000 NSW New Home Buyers Supplement for new homes where contracts were signed from 11November 2008.
In addition to the above mentioned subsidies and grants first home buyers in NSW also have access to concessions relating to stamp duty costs.
