Attention First Home Buyers in 2020

Multiple First Home Buyer Options

As of January 1, 2020, there are going to be many alternatives for first home buyers wanting to purchase a house. This year has seen record numbers of first home buyers entering the real estate market. In fact, this is the most first home buyers seen in over a decade. In the coming year, we anticipate this trend to continue in a positive direction.

It is every Australian’s dream to own their own home. Statistically, it takes up to 10 years of hard work and savings to reach the deposit target for your new home.

On January 1, 2020, the Federal Government will be releasing the Loan Deposit Scheme. This is the Governments latest offering to first home buyers which has savings close to $10,000 just for Lenders Mortgage Insurance LMI. To qualify for this grant purchasers will require a 5 per cent deposit. If you are single your income cannot exceed $125,000 and if you are a couple the income threshold is $200,000. The property value ceiling for Sydney, Newcastle and Wollongong properties is $700,000 and $450,000 for regional NSW.

Overseeing this scheme is the National Housing Finance and Investment Corporation NHFIC. The first bank announced to the scheme is the National Australia Bank. There are to be other lenders named shortly.

The availability for this grant has been limited to 10,000 applicants. This represents just 10% of the expected first home buyers in 2020.

Other First Home Buyer Incentives and Options

Option 1 – The First Home Owner Grant of $10,000 is on the table if you buy or build your new home. Please note that if you are purchasing a home it can be no older than 5 years and must be the first time the home has been offered for sale. In regional NSW, the First Home Owner Grant is $20,000 for new homes. To qualify for these grants the contract of sale must be prior to June 30, 2020.

Option 2 – In unison with the above grants is the exemption on stamp duty. You can claim the full stamp duty payable if you are going to live in the property and its value is no more than $700,000.

Stamp Duty Savings

  • $400,000 = $13,432.00
  • $450,000 = $15,682.00
  • $500,000 = $17,932.00
  • $550,000 = $20,182.00
  • $600,000 = $22,432.00
  • $650,000 = $24,682.00
  • $700,000 = $26,932.00

Option 3 – First Home Super Saver Scheme.

If you’re an eligible first home buyer, aged 18 or over, you can withdraw voluntary super contributions (which you’ve made since 1 July 2017) to put toward a home deposit.

Under the FHSSS, first home buyers, who make voluntary super contributions of up to $15,000 per financial year into their super, can withdraw these amounts (in addition to associated earnings / less tax) from their super fund to help with a deposit on their first home.

If you’re eligible, the maximum amount of contributions that can be withdrawn under the scheme is $30,000 for individuals or $60,000 for couples. So, your earnings are going to be more than enough to cover your 5% deposit on a $700,000 purchase and you can then take advantage of the First Home Loan Deposit Scheme as well.

Here is a list of links to schemes available to first home buyers.

The National Housing Finance and Investment Corporation NHFIC

Stamp Duty Calculator Transfer of Land

First Home Owner Grants and Schemes

6th December 2019


Peter Farrell