Buying your first home can be one of the most exciting times of your life and a valuable, long-term investment. Before you sign the dotted line, there’s a lot you need to consider. In this guide, we’ll cover the basics and the best ways you can save money with government grants and incentives.
Home loans, First Home Owners Grants, stamp duty and contract of sale. When buying your first home, a lot of these terminologies may be new to you and it can become overwhelming.
The best way to combat becoming overwhelmed is to spend the time learning the steps involved with buying your first home, consider your options and speak to experienced property professionals before making any decisions.
First and foremost, it’s important to understand your financials and what you can afford.
Your first home budget
How long it takes to save for your first home will vary depending on a number of factors. Your income, current expenses and preference of first home will all impact your ability to save for a deposit.
According to the Australian Government’s Money Smart website, it takes the average Australian couples 4.6 years to save for a 20% house deposit. However, this figure will differ between suburbs and if your preference is to buy an apartment over a house.
Home Start Finance has a few handy calculators that makes it easy for you to determine how much you need to save, how much you may be eligible to borrow and what your repayments will be.
After you’ve established your borrowing power and saved your deposit, we recommend getting in touch with your preferred bank or Mortgage Broker to receive personalised support with arranging your finances. They will be able to talk you through your options and decide on the best one for you.
Government grants and incentives
The Australian Government has introduced various grants that make it easier for buyers to own their first home sooner. These grants will vary depending on where you live.
The First Home Owners Grant (FHOG) is a great way to save thousands off the cost of buying your first home and is applicable when your home is new (never lived in before). Along with the grant, there are multiple other benefits to buying a new home, such as lower bills, less maintenance and access to great amenities.
In Melbourne, the FHOG is $10,000 towards new houses or apartments valued at less than $750,000 or $20,000 in regional Victoria.
Another option first home buyers have is the First Home Loan Deposit Scheme (FHLDS) which allows first home buyers to borrow from applicable lenders with less than 20 per cent deposit. Usually this would incur mortgage lenders insurance which costs thousands however under this scheme, eligible first home buyers can purchase a new or established home with as little as 5 per cent deposit.
If you aren’t eligible for either of these grants, you may still be eligible for a duty exemption or concession. If your home is valued at less than $600,000 you could receive the first home buyer duty exemption, whereas if your home is valued up to $750,000 you may be eligible for the first home buyer duty concession.
Moving into your new home
If you’re lucky enough to find the first home of your dreams, there’s nothing more exciting than having your offer accepted and getting ready to move in!
The process of buying your home will differ depending on the type of property it is, where you live and how you are acquiring it so it’s best to speak with your sales consultant and bank to receive advice regarding finalising the sale.
If your dream is to purchase a new apartment, chances are you could be purchasing directly from the developer which opens up great opportunities for you to access additional developer incentives!
Millhouse Residence, Footscray’s newest residential community, is now selling. Register your interest now to receive exclusive access to floorplans, pricing and incentives.