If you’re planning on buying or building your very first home in New South Wales, you’re going to want to know all about the first home buyers assistance schemes on offer, particularly the First Home Owners Grant (FHOG) in NSW.
Making it easier for eligible first time owners to secure a new home, the FHOG essentially provides financing and long term benefits to those that are eligible for it - so what’s the catch? Surprisingly, it really isn’t all that complicated if you have all the details clearly laid out.
In this blog, we explore the First Home Owners Grant and how it’s enacted in NSW. What’s it all about? How much financing will it cover? Are you eligible to apply for one? Let's find out!
What is the First Home Owners Grant in Australia?
At the basic level, the FHOG is a national assistance scheme that assists first home buyers in partially covering the costs to purchase or build a new home that they intend to live in.
Lets take a look at how these terms are defined by the grant:
Who is defined as a first home buyer?
A first home buyer under the First Home Owners Grant is someone who:
- Does not currently own property in Australia that they live in.
- Has not previously owned property in Australia that they lived in.
- Has not owned a home before 1st July 2000, whether lived in or not.
If you are applying for the grant with a spouse, partner or co-buyer, these definitions will apply to them as well.
What is defined as a new home?
A new home can be any dwelling (like a house, apartment, unit or similar) that has been newly built, off-plan or significantly renovated.
In the case of renovated homes, these conditions must be met:
- Most of the home should be removed or replaced.
- It has not been lived in before, during or after renovations.
- It has not been sold since the completion of renovations.
This scheme is available in all states across Australia, however rules and regulations may differ. In New South Wales, the FHOG is managed by Revenue NSW and is just one of the first home buyer assistance schemes offered through the government.
How much does the First Home Owners Grant in NSW cover?
In NSW, the FHOG will cover a one-time sum of $10,000 towards the purchase of a new home, and include all the benefits of the First Home Buyer Assistance Scheme.
When will the grant be paid?
This depends on the type of housing you applied for and how your application was submitted:
Type of Housing | Application Method | Payment of Grant |
|---|---|---|
Purchase of a new home | Approved agent Revenue NSW | On the purchase day The payment will be made to your account within 14 days of lodging your application. An application will only be considered after purchase. |
Contract to build | Approved agent Revenue NSW | On the date of first progressive payment The payment will be made to your account within 14 days of lodging your application. An application will only be considered after the Certificate of Occupancy has been issued. |
Owner builder | Approved agent Revenue NSW | On receipt of Certificate of Occupancy The payment will be made to your account within 14 days of lodging your application. An application will only be considered after the Certificate of Occupancy has been issued. |
Am I eligible for a First Home Owners Grant in NSW?
Apart from checking the standard eligibility boxes, your new home must also meet specific requirements.
Here’s a breakdown of all the eligibility requirements which you (and your future property!) should meet.
Eligibility for a First Home Owners Grant in NSW
Housing Category | Eligibility Conditions |
|---|---|
All types | At least 18 years old and a permanent resident or Australian citizen. You must apply as an individual, not as a company or trust. In the case of co-applicants, at least one must be a permanent resident or Australian citizen. No applicant has previously owned a home before 1 July 2000. You must occupy your first home as your principal place of residence for a minimum of 6 continuous months. Occupancy must occur within 12 months of the construction or purchase of your home. |
Purchase of a new home | The purchase price must not exceed $600,000 |
Comprehensive home building contract (Off-plan) | Property Value (house and land) must not exceed $750,000 |
Owner builder | Property Value (house and land) must not exceed $750,000 |
How do I apply for a First Home Owners Grant in NSW?
If you’re applying before purchase or construction is completed:
- You must apply through one of the approved agents for Revenue NSW.
- Download a copy of the First Home Owners Grant application form and lodge it through your chosen bank or financial provider.
If you’re applying after purchase or construction is completed:
- You can lodge the application directly through the First Home Owners Grant customer portal
- The application must be submitted within 12 months of the date of purchase or construction of your new investment property.
- Remember that applying after purchase means that you won’t have the benefit of the grant on the settlement day. This means you’ll have to cover the full purchase price yourself.
Along with the grant form, there’s quite a bit of paperwork you would need to submit as well:
Type of Transaction / Housing | Required Documents For Application |
|---|---|
Purchase of a new home | For all property types, a document from each of these categories is needed: Category 1 - your primary identity document (Australian birth certificate or foreign passport or visa). If you are born overseas, you may submit a copy of your foreign passport even if it’s an Australian passport.) If you don’t have a foreign passport, you can provide a written statement explaining why, the full name displayed on the foreign passport and the date you arrived in Australia Category 2 - photo and signature (for example, your NSW driver’s license) Category 3 - proof of operating in community (for example, your Medicare card) |
If you’re under a contract to purchase a new home | A copy of your contract for sale, dated and signed by the vendor A title search that shows you as the property owner A statement from the vendor saying that this is the first sale of the home and it has not been previously occupied since the completion of construction A list of renovations if the home has been substantially renovated |
If you’re under a contract to build a new home | A copy of the front page, signature page and Schedules 1 to 5 of the building contract, dated and signed by all parties A title search showing you as the property owner A copy of the interim or final occupation certificate Recent evidence of the land value Final build cost statement from the builder including the cost of any variations |
If you’re an owner builder | A title search showing you as the property owner A copy of the initial inspection report or approval from the Council for laying the foundation A copy of the final inspection report or occupation certificate A copy of receipts for the home, totalling more than the grant amount Evidence of the total property value (house and land) |
Is a First Home Owners Grant right for me?
As with any financial undertaking, its important to weigh the pros and cons out carefully. Here’s a few considerations to keep in mind about the FHOG.
- You are obligated to stay on the property for 6 consecutive months and make it your principal place of residence. This can be a drawback if you have to travel on urgent matters.
- If you move out of your home before the mandatory 6 months are up, you will need to repay the grant and any additional duty. Failure to repay the grant will land you with a $11,000 fine.
- Your home choice is limited to newly built or renovated property, which can be pricier compared to established homes. This does however provide some safety net against unforeseen damage or repairs that might come with an older house.
- If either you or your spouse have obtained the grant previously, this would disqualify any co-applicant from applying for one (even if it is their first home or they haven’t previously received the grant.
All in all, if you meet the criteria, the First Home Buyers Grant NSW is a great little financial asset to kick-start your first steps into the property market (and a new home!)
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