First Home Owners Grant – General Information
On 1 July 2000 The First Home Owner Grant (FHOG) scheme was introduced to offset the effect of the GST on home ownership. The scheme operates nationally and is funded by the states and territories. Under the scheme, a one-off grant starting from $14000 (varies by state) is payable to first home owners that satisfy all the eligibility criteria. For more details about the grant visit your FHOG state government website.
Another common feature offered with first home buyer loans is called a ‘honeymoon period’ or ‘introductory rate’. These rates generally come capped, fixed or variable for up to the first 12 months and are offered at 1% below the standard home loan rate. After the introductory period the rate will revert to the lenders’ standard rate.
On top of your mortgage repayment there are a number of additional expenses associated with buying a house. Some of these include:
- Government fess and stamp duty
- Mortgage protection insurance: mandatory if borrowing more than 80% of property value
- Legal fees: approx 2% of property value
- Building inspection & pest inspection fees
- Moving costs
- Mtility connection and transfer fees
- Council rates
The Federal Government has designed an initiative to help first-time home buyers save for a deposit. They feature government co-contributions and a lower tax rate on interest and earnings.