More good news for first home buyers
In amongst all the media coverage of Tuesday’s Federal Budget, there was an item that seemed to escape the attention of many in the media, but which would have pleased quite a few first home buyers.
The Treasurer, Josh Frydenberg, announced that the First Home Loan Deposit scheme would be extended to assist an additional 10,000 first home buyers in this current financial year. This extension is designed to assist those buyers building a new home, or purchasing off the plan, but it will also help those first home buyers buying an established home as it will mean that the existing allocation will last longer as well.
As we explained in our post about this scheme in January, the First Home Loan Deposit Scheme enables buyers to avoid having to pay lenders’ mortgage insurance purchase when buying their first home, even with a deposit as low as 5 per cent. In effect, the Federal government becomes a guarantor of the loan.
This scheme is designed to encourage first-home buyers on lower incomes to enter the property market with a lower deposit, and would mean that aspiring homeowners would only need to save $30,000 to purchase a property worth $600,000 and would not be required to take out Lender’s Mortgage Insurance, (a major additional cost for many market entrants).
Mr Frydenberg also announced that the property price limit associated with these additional assistance packages would be lifted to $850,000 in the Melbourne metropolitan area. This will be good news for those first home buyers who were finding that securing a property under the previous limit of $750,000 is a challenge in some areas.
Another item in the Budget that could affect some older Australians and their families is the decision to make granny flats exempt from capital gains tax from July 2021, providing a formal written agreement is in place. This should help some local families where an older family member currently resides in part of the home or in a granny flat.
Of course, if you are currently looking for your first home, and would like some assistance in securing the right property without delays, don’t hesitate to call our team at Barry Plant Thomastown on 9466 3233. Alternatively, you can call me personally on 0418 331 741.
Cheers,
Con Constantinou
Barry Plant Thomastown