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The incentives available to Australian first home buyers, state-by-state

The incentives available to Australian first home buyers, state-by-state

First home buyers are out in full force despite COVID-19, and that may well be thanks to the many financial incentives available to them. 

The desire for home ownership among Australians is still strong. About 45 per cent of Australian millennials said they will be focusing on buying a property as a financial goal for the next five years, up by three percentage points since February 2020, UBank’s latest Know Your Numbers survey showed.

While there is extensive financial support out there for first home buyers, wading through complicated government and banking resources can be a chore in itself. 

Accessing these incentives could potentially be the difference between getting tens of thousands of dollars no help at all, so knowing how the system could work to your favour is important.

Before considering any of these support measures, make sure you understand their eligibility criteria and other terms and conditions they may carry.

Government support for first home buyers

First Home Loan Deposit Scheme

One of the more talked-about government measures, the First Home Loan Deposit Scheme (FHLDS) allows eligible first home buyers across Australia to buy a property with a minimum deposit of 5 per cent without being charged lenders mortgage insurance (LMI).

Usually, a 20 per cent deposit is required if you want to sidestep LMI costs, which can, in some cases, cost up to tens of thousands of dollars. Under the FHLDS, the federal government guarantees the difference .

The scheme does have property price thresholds, so it’s important to check if the price bracket you’re aiming for falls below the cap.

The 2020 federal budget added an additional 10,000 places to the scheme and updated the price thresholds, which better reflect property values in capital cities.

You can access the FHLDS through 27 participating lenders across Australia.

Home Builder

The Commonwealth HomeBuilder Grant provides a one-off $25,000 to eligible first home buyers and other owner-occupiers wanting to build or substantially renovate a new home.

Some conditions include:

  • Individuals must earn an annual income of less than $125,000, and $200,000 for couples.
  • Property value must not exceed $750,000; or if you are substantially renovating your existing home, the value of your home must not exceed $1.5 million before construction.
  • Contract must be signed between 4 June 2020 and 31 Dec 2020.
  • Construction work must happen within three months of the contract’s signing. 

State-based government support

Aside from the deposit, many Australians seeking to purchase their first property believe stamp duty is one of the biggest barriers between them and home ownership. But most states and territories offer at least some assistance on this cost, including some exemptions, for eligible first home buyers.


  • Stamp duty exemption for new homes worth up to $800,000 (temporary measure until July 31, 2021).
  • Stamp duty concessions available for new homes up to $1 million. (temporary measure until July 31, 2021).
  • Stamp duty exempt for existing properties worth up to $650,000.
  • Concessions apply for existing properties between $650,000 and $800,000.
  • One-off grants of $10,000 if you buy a new or “substantially renovated” property worth up to $600,000.
  • You may also receive the grant if you buy land to build a new home worth up to $750,000 in total (land and home).


  • First home buyers may pay $0 in stamp duty on all homes worth up to $600,000. Properties can be new or established.
  • Concessions apply for properties worth between $600,000 and $750,000.
  • $10,000 first home owner grant when you buy or build your first new home worth no more than $750,000.
  • $20,000 for new homes built in regional Victoria (until 30 June 2021). 


  • No transfer duty payable on all homes valued up to $500,000.
  • Concessions available for homes worth between $500,000 and $550,000.
  • One-off grant of $15,000 for first home buyers purchasing or building a new home of up to $750,000.
  • $5,000 may be granted after you buy or build a new home worth less than $750,000. 

Western Australia

  • No transfer duty for all homes less than $430,000.
  • Sliding scale concessions for homes worth between $430,000 and $530,000. 
  • One-off first home owner grant of $10,000 if you buy or build a new or “substantially renovated” home.
  • Value of property must be below $750,000 if south of the 26th parallel (including all Perth metropolitan areas). The 26th parallel marks the border between northern and southern Australia.
  • Value of property must be not exceed $1 million if north of the 26th parallel.
  • $20,000 Building Bonus grant for eligible applicants who build a new home on vacant land, or buy an off-the-plan home that is part of a single-tier development (such as a townhouse) before 31 December 2020.
  • an off-the-plan duty rebate of 75 per cent of the duty paid (capped at $50,000) for those buying a new unit/apartment, entering a pre-construction contract between 23 October 2019 and 23 October 2021.
  • an off-the-plan rebate of 75 per cent of the duty paid (capped at $25,000) for those buying a unit/apartment under construction, entering a contract before December 31, 2020.

South Australia

Australian Capital Territory

  • Pay no stamp duty on new or established properties of any value if you and your partner's gross (before tax) income is below $160,000. If you have children, the threshold is lifted on a sliding scale, depending on the number of kids you have. The maximum income threshold is $176,650 for households with five or more children.
  • Owner-occupiers exchanging contracts before 30 June 2021 may pay no stamp duty on vacant residential blocks for a single house or off-the-plan units up to $500,000. They may also have their stamp duty reduced by $11,400 for off-the-plan unit purchases between $500,000 and $750,000.


  • Half price discount on stamp duty for purchases of established homes up to $400,000 until 30 June 2022. 
  • One-off first home owner grant of $20,000 for new builds or purchases of new builds until 30 June 2022. 
  • Tasmanian HomeBuilder Grant of $20,000 for eligible new home builds (valued up to $750,000) for contracts entered into before 31 Dec 2020 (subject to income caps). 

Northern Territory

  • Stamp duty discount of up to $18,601 for existing or new homes buyers and those buying land to build a new home, at the value of $650,000 or less. 
  • $10,000 first home owner grant for new home constructions or purchases of new builds. 
  • A home renovation grant of up to $10,000 if you purchase an established property as your first home (not for owner-builders or DIY renovators). Applications close 30 November, 2020. 
  • Similar to the FHLDS, the HomeBuild Access allows new home buyers or those building their new home to take out a home loan with a deposit of as low as 2 per cent, without paying LMI. Property price caps apply. 

Non-government incentives for first home buyers

It’s not just governments offering first home buyer incentives. Some banks and lenders may also extend financial perks to this growing cohort, as they strive for business in the competitive market.

Lenders mortgage insurance discounts

Incentives from lenders can come in the form of an LMI discount. LMI is a cost that’s typically required by lenders if buyers purchase a home with a deposit smaller than 20 per cent of the property value. LMI can cost some buyers up to tens of thousands of dollars.

It’s a good idea to double check the lender’s loan-to-value ratio (LVR) requirements before deciding whether to apply for an LMI discount offer.

LenderLMI discount
ME BankLMI discounted by 25% for LVRs up to 95%, offer valid to 30 Nov 2020
St GeorgeLMI reduced to $1 for LVRs up to 85%
Bank of MelbourneLMI reduced to $1 for LVRs up to 85%
BankSALMI reduced to $1 for LVRs up to 85%
Virgin Money$0 LMI for LVRs up to 85%. Apply by 29 Nov 2020
BankVic30% of LMI premium refunded to you if LVR is between 85-90% and take out a FHB loan, no LMI on LVRs up to 85%
RAMSIf LVR is between 80%-95%, LMI will be refunded up to $5k with a premium of at least $1 payable for LMI by the customer
Bank FirstNo LMI for LVRs up to 85% for Premier Package Home Loan holders where approval conditions are met
Unity BankOffers a no LMI home loan for FHBs with LVRs up to 85%
Southern Cross Credit Union10% off LMI for first 20 applicants - between 28 Sept and 3 Nov 2020

Source: RateCity.


While most cashbacks are targeted at refinancing mortgage borrowers, there are 10 mortgage lenders on the RateCity database which offer cashback incentives to first home buyers.

This extra cash could go a long way for many people purchasing their first home, but it’s not a good idea to simply go with the lender offering the highest cashback. Make sure to go through the terms and conditions before applying.

LenderCashback amount
Heritage Bank$2,000
Illawarra Credit Union$2,000
Credit Union SAup to $3,000
Southern Cross Credit Union$2,000
Reduce Home Loansup to $2,000
Police Bankup to $2,000

Source: RateCity.com.au

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This article was reviewed by Senior Journalist Tony Ibrahim before it was published as part of RateCity's Fact Check process.



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