Leasing a Home

First Home Buyer

Buying your first ever home is a leap of faith, and a giant one at that. It is normal to have many concerns and questions regarding all the applicable fees and costs, the time frame it will take before the loan can be settled, and just the entire process in general. Here at Endeavour Financial, we aim to reduce any stress and burden of taking on your first ever large-scale mortgage by guiding you step-by-step through the entire process.

Government Grants & Benefits

Comprehensive Package

In January 2020, the NSW Government has introduced a comprehensive package aimed at improving housing affordability for owner-occupied first home buyers, who often face stiff competition from investors.

  • No stamp duty for homes up to $650,000.

  • No stamp duty for land up to $350,000.

  • Stamp duty relief for homes up to $800,000.

  • A $10,000 grant for purchasers of new homes up to $600,000.

  • A $10,000 grant for builders of new homes up to $750,000.

Post-COVID19 Support

In August 2020, the NSW Government extended all available grants and concessions to also include newly built properties to further support the construction industry and owner occupied first home buyers during post-COVID19 lockdowns.

  • No stamp duty for newly built homes up to $800,000.

  • No stamp duty for land up to $400,000.

  • Stamp duty relief for newly built homes up to $1,000,000.

  • A $10,000 grant for purchasers of new homes up to $600,000.

  • A $10,000 grant for builders of new homes up to $750,000.

First Home Loan Deposit Scheme (FHLDS)

The First Home Loan Deposit Scheme (FHLDS) is a government measure designed to help people enter the property market for the first time. Usually, Australian home buyers have to either save up a deposit of at least 20% of their property’s value, or take out Lender’s Mortgage Insurance – which can often cost thousands of dollars. Under this new scheme, the Australian Government will guarantee 10,000 low-deposit loans a year, for eligible low- and middle-income earners who have saved up a deposit of as little as 5% of a property’s value.

Am I Eligible?

In order to qualify for this scheme, you must:

  • Be an Australian citizen

  • Be at least 18 years old

  • Be either:

    • Single with a taxable income of up to $125,000 per year

    • Couple with a combined taxable income of up to $200,000 per year - must be married or in a de-facto relationship, i.e. couples such as siblings, a parent and child or two friends buying together would not be eligible

  • Be obtaining a residential loan; Repayments must be via Principal & Interest for the entirety of the loan

    • Obtaining a loan with purpose of purchasing vacant land as well as construction of a house on the land may be eligible for Interest Only repayments for a specified period

  • Be first home buyers who have not previously owned or had an interest in a residential property, either solely or jointly

  • Have a deposit of between 5% and 20% of the property’s value

  • Intend to move into and live in the property as their principal place of residence and continue to live in the property for as long as the loan “has a guarantee under the Scheme”

How Do I Apply?

  1. Visit a broker: Tell them you’d like to be considered for the scheme. 

  2. Reserve a place: Your chosen participating lender will assess if you are eligible for a spot in the scheme. If you are, and there’s a spot available, they will reserve a place on the scheme for your loan. 

  3. Finalize your budget: You have 10 days to obtain conditional approval for a loan from a lender. This will determine how much you can borrow and therefore how much you can spend on a home.

  4. Find a house: You have 90 days to find, negotiate for and sign a contract on a property, ensuring the home is priced below the property price threshold for its location. 

  5. Buy the house: You have up to 30 days for the settlement period – to allow time for the bank to finalise the loan, and for the usual legal processes that allow a house contract to settle.

  6. Move in: You must move into the house within 6 months of settlement.

Which Lenders are Offering this Scheme?

31 Lenders are currently participating in this scheme;

  • Australian Military Bank

  • Auswide Bank

  • Bank Australia

  • Bank First

  • Bank of us

  • Bendigo Bank

  • Beyond Bank

  • Commonwealth Bank

  • Community First Credit Union

  • CUA

  • Defence Bank

  • Endeavour Mutual Bank

  • Firefighters Mutual Bank

  • G&C Mutual Bank

  • Gateway Bank

  • Health Professionals Bank

  • Indigenous Business Australia

  • Mortgageport

  • MyState Bank

  • National Australia Bank

  • People’s Choice Credit Union

  • Police Bank

  • P&N Bank

  • QBANK

  • Queensland Country Credit Union

  • Regional Australia Bank

  • Sydney Mutual Bank

  • Teachers Mutual Bank

  • The Mutual Bank

  • UniBank

  • WAW Credit Union

Is There a Cap on the Price of the Property?

Yes. The Australian Government says that the FHLDS “is only available for the purchase of a modest home” and so it has capped the price of the homes eligible under the scheme. The caps are different depending on where you want to buy: 

  • NSW – capital $700,000

  • NSW – regional (Newcastle and Lake Macquarie) $700,000

  • NSW – regional (Illawarra) $700,000

  • NSW – other $450,000

  • VIC – capital $600,000

  • VIC – regional (Geelong) $600,000

  • VIC – other $375,000

  • QLD – capital $475,000

  • QLD – regional (Gold Coast) $475,000

  • QLD – regional (Sunshine Coast) $475,000

  • QLD – other $400,000

  • WA – capital $400,000

  • WA – other $300,000

  • SA – capital $400,000

  • SA – other $250,000

  • TAS – capital $400,000

  • TAS – other $300,000

  • ACT $500,000

  • NT $375,000

  • Jervis Bay Territory & Norfolk Island $450,000

  • Christmas Island & Cocos (Keeling) Island $300,000

HomeBuilder Renovation Grant

The HomeBuilder Renovation Grant is a $25,000 tax-free grant designed for owner occupiers and first home buyers only. It is federal government scheme initiated since August 2020 to help continue the Australian residential construction industry and trades activity in general. 

Am I Eligible?

In order to qualify for this scheme, you must:

  • Be a first home buyer & the new property value or construction cost is less than $750k.

  • An owner-occupier & your property value is less than $1.5m and the renovation cost is between $150k - $750k.

  • An Australian Citizen (Permanent residents, company, trusts, owner-builders are not eligible). 

  • Have the build or renovation contract is signed by 31st December 2020 and the construction work must start within the 3 months of the contract signing date.  

The grant is given to buyers or owner-occupiers after the construction work has started and the first progress payment for the construction has been made. The owner occupied renovators have to provide proof of renovation (signed contract) to State Revenue Office to receive the grant after the work starts.

First Home Super Saver Scheme

The First Home Super Saver (FHSS) scheme was introduced by the Australian Government in the Federal Budget 2017–18 to reduce pressure on housing affordability. It allows you to save money for your first home inside your super fund. This will help first home buyers save faster with the concessional tax treatment of superannuation. It applies to voluntary superannuation contributions made from 1 July 2017. These contributions, along with deemed earnings, can be withdrawn for a home deposit from 1 July 2018.

Am I Eligible?

In order to qualify for this scheme, you must:

  • never owned property in Australia – this includes an investment property, vacant land, commercial property, a lease of land in Australia, or a company title interest in land in Australia

  • be aged 18 years or older; and

  • have not previously had an amount released from superannuation under this scheme.

How Much Can I Contribute?

Any voluntary contribution you make into your superannuation account can count towards your FHSSS balance.

Certain types of contributions are not eligible to be withdrawn under the FHSS scheme, including:

  • compulsory employer contributions (eg: Superannuation Guarantee)

  • spouse or child contributions

  • Government co-contribution

  • Contributions made by another individual or entity on your behalf (except where your employer makes additional contributions for you under an agreed salary sacrifice arrangement), and

  • voluntary contributions to defined benefit funds or constitutionally protected funds.

You can contribute up to $15,000 a year, and $30,000 in total, under the FHSSS. These contributions must be within existing contribution caps (i.e. $25,000 per year concessional contributions cap).

Concessional contributions (e.g. salary-sacrificed) are taxed at 15% in the fund, as usual. Any after-tax contributions are not taxed.

When Can I Withdraw My Savings?

From 1 July 2018, you can withdraw your savings when you are ready to enter the housing market. You do not need to have found your home yet, but you will need to buy a home within 12 months of withdrawal. 

The ATO will be able to tell you the maximum amount you can release under the FHSSS, and you can apply to them to release when you’re ready. Withdrawals are generally taxed at your marginal tax rate less a 30% rebate. The ATO will arrange for money to be released from your super and will pay it on to you. They will withhold an estimate of the tax owed on the withdrawal amount.

What Kind of Home Could I Buy?

You must buy a ‘residential premises’ after withdrawing your savings. This includes vacant land (if you’re planning to build), but not any premises that can’t be occupied as a residence, and not houseboats or motor homes. It has to become your home, not an investment property; you would have to occupy the premises for at least 6 months in the year after purchase (or construction).

If you don’t buy a home after your time expires, you may either contribute the released amount back into superannuation, or pay a tax equal to 20% of the concessional amount released. This removes the tax benefit you received from using the FHSSS.