A comprehensive look at the First Home Loan Deposit Scheme. Could it help kickstart your homeownership dream?

With 2020 fast-approaching, the new year presents an exciting opportunity to recognise your home-ownership dreams.

Here at Metricon Homes, we know that saving up enough money for a sizable deposit is one of the biggest hurdles for first-time buyers. The need for mortgage insurance if your deposit is less than 20 per cent of the total property price exacerbates that. A one-off payment, this can add several thousand dollars to the upfront costs.

Luckily for 10,000 Australians on low-to-middle incomes, the New Year brings a new initiative from the Federal Government, The First Home Loan Deposit Scheme (FHLDS), that could make the pathway to homeownership easier. By offering loan guarantees, this new scheme could help you get into the property market faster and with less money saved.

How does it work?

In a nutshell, the Government, in conjunction with financial lenders including NAB, steps in as guarantor, opening the opportunity of securing a new home from as little as a five per cent deposit.

The First Home Loan Deposit Scheme (FHLDS) comes into effect on 1 January 2020. Administered by the National Housing Finance and Investment Corporation, it’s a first-in, best-dressed policy for eligible applicants, so jump on it quickly if you want to secure one of the 10,000 sure to be in-demand spots.

Even better, if you are one of the lucky applicants, the hand-up can be used in conjunction with state-based First Home Owner Grants and stamp duty concessions.

Do I qualify?

To be considered for the FHLDS, single applicants will need to demonstrate they earned less than a taxable income of $125,000 in the previous financial year, or $200,000 for couples. It only applies to prospective owner-occupiers, not investment properties or holiday homes. You must have a minimum five per cent deposit saved, up to a maximum of 20 per cent.

It’s only applicable to Australian citizens 18 years or older who are first home buyers who are not purchasing property as part of a company or trust. If applying as a couple, you must be spouses or in a de facto relationship and both applicants need to meet all requirements. Siblings, friends, parents or children do not qualify.

What properties fall under the scheme?

The scheme applies to many homes as it works on property value vs property type. It can be used for the purchase of a home, or the purchase of land and construction of a home. If you’re thinking about using it for a new Metricon build, it would be most applicable to our home and land packages.

It’s worth noting that the FHLDS places a limit on the total house price the scheme will cover. That changes from state-to-state and depending on whether you plan to build in an urban or regional centre with a population north of 250,000, or somewhere more remote.

Here are the limits for the states where Metricon builds.

Capital/regional centre NSW: $700,000
Rest of state NSW: $450,000

Capital/regional centre VIC: $600,000
Rest of state VIC: $375,000

Capital/regional centre QLD: $475,000
Rest of state QLD: $400,000

Capital/regional centre SA: $400,000
Rest of state SA: $250,000

You can check the postcode of your prospective first home build here to make sure which cap applies to you. Applications for the FHLDS will not open until 1 January 2019.

Other opportunities state-by-state

In addition to the FHLDS, there are other first home owner incentives to help you realise your home buying goals. Let’s break this down state-by-state and look into these incentives a little more closely.

New South Wales
The First Home Owner Grant is available to first home buyers who buy or build a new property or secure a home and land package. If eligible, you can access $10,000. Find out more here. You might also be entitled to stamp duty concession.

Queensland
The First Home Owner Grant is available to first home buyers who buy or build a new property or secure a home and land package. If eligible, you can access $15,000. Find out more here. You might also be entitled to stamp duty concession.

Victoria
The First Home Owner Grant is available to first home buyers who buy or build a new property or secure a home and land package. If eligible, you can access $10,000 for a city property, or $20,000 for Regional Victoria. Find out more here. You might also be entitled to stamp duty concession.

South Australia
The First Home Owner Grant is available to first home buyers who buy or build a new property or secure a home and land package. If eligible, you can access $15,000. Find out more here. You might also be entitled to stamp duty concession.

How can we help?

So, with the new Government initiatives on the table for 2020, coupled with existing grant schemes, homeownership is looking a lot more attainable. Let’s look at the best option for you and your state.

In NSW, Freedom by Metricon is the ideal choice for anyone who qualifies for a First Home Owner Grant. Freedom homes are stylish, spacious and affordable – perfect for growing families and a great launchpad into the property market. Check out our latest offer for the Elsa here.

In QLD, VIC and SA, First Home Owner Grant pairs perfectly with our low-deposit offering HomeSolution by Metricon. Designed to make the Australian dream of first homeownership more achievable, HomeSolution has helped over 1000 Australians get into their own home even when they thought it might not be possible. We’ve made it as easy and affordable as possible.
For more information on HomeSolution in each state, follow the links below:

• Queensland
• Victoria
• South Australia

Ask us about how Metricon can help you into your first home. Get in touch here or call us on 1300 METRICON.