First Home Buyers Rejoice

As a recent first home owner myself, I understand that purchasing your first home may seem daunting and out of reach. The Queensland Government currently offers two great incentives to those of you who are thinking of purchasing, or building, your first home.

Queensland First Home Owners’ Grant (only for NEW homes)

As of 1 July 2016 (and for the next 12 months) the Queensland First Home Owners’ Grant (formerly known as the Great Start Grant) has increased from $15,000.00 to $20,000.00. The grant was introduced by the Queensland state government to help first home owners get into their new first home sooner. The increased grant of $20,000.00 only applies to building contracts entered into from 1 July 2016. It will not apply to contracts entered into before 1 July 2016, nor will it apply to contracts made for the purpose of replacing prior contracts entered into before 1 July 2016, for the intention of obtaining the higher grant.

It is important to note that you are only eligible for the grant if:-

1. you are an Australian citizen or permanent resident (or applying with someone who is);
2. you or your spouse has not previously owned property in Australia (a spouse includes, a person you are married to, a person you are in a de facto relationship with, who you have lived with on a genuine domestic basis for 2 years or more, a registered partner under the Relationships Act 2011);
3. you are at least 18 years of age;
4. you are buying or building a brand new home valued under $750,000.00 (a brand new home includes a house, apartment, unit or townhouse that has not been previously occupied as a place of residence, has not been previously sold as a place of residence or is a substantially renovated home. For more information on substantially renovated homes please click here. If the property you are purchasing is valued at $750,000.00 or over the grant will not be paid.

You may not be eligible for the grant if you are:-

1. buying or building your new home with financial help from a related person (who is not eligible for the grant) who will also stay in the home often or live in the home for long periods of time. A loan from a bank or lending institution is not financial help;
2. entering into an arrangement for the main purpose of getting the grant, rather than to assist you in getting a new home.

If you have signed a contract and are eligible for the grant (whether it be the $15,000.00 or $20,000.00) you can submit an application directly to the Office of State Revenue. Alternatively, you can apply for the grant through many banks and lending institutions at the same time that you organise your loan. 

First Home Transfer Duty Concession

Together with the Queensland First Home Owners’ Grant you may be eligible for the Office of State Revenue transfer duty (previously known as stamp duty) concession. When you buy or transfer property in Queensland you may be required to pay transfer duty. The amount of transfer duty depends on the price of the property (or the agreed value of the property- if no money exchanges hands).

Vacant Land purchased to construct your first home

If you are purchasing a block of land to build your first home you may be eligible to receive a concession. In order to qualify for the concession you must:-

• occupy the dwelling constructed on your land as your first principal place of residence;
• you must finalise construction of the dwelling on the land and move into the house within two (2) years from the settlement date;
• reside on the dwelling for at least a consecutive period of twelve (12) months (starting from when you begin residing- i.e when the property is built and you move in;
• not lease or rent all or part of the house within the first twelve (12) months after you take possession;
• notify the Office of State Revenue in writing if any circumstances change within the first year you have resided in the property (you have twenty-eight (28) days to notify them of the changes). The Office of State Revenue would then make a reassessment of the transfer duty.

If you sold or leased the premises within the first twelve (12) months following taking possession of the property you would lose your entitlement to the concession and a reassessment would be completed.

A new or established first home

If you are purchasing a new or established home, which is your first home, you may be eligible to receive a transfer duty concession. In order to qualify for the concession you must:-

• occupy the premises as your first principal place of residence;
• not have owned any property anywhere prior to the purchase;
• occupy the premises within one year after the settlement date of the purchase. The Seller may stay at the property after the settlement date, however, they must vacate the property as soon as it is reasonably practical to do so or within six months after the settlement date, whichever is sooner;
• reside on the premises for at least a consecutive period of twelve months (once you move into the property);
• not lease or rent the premises out within the first twelve months of the settlement date;

If any circumstances change within the first year that you live in the property you will have only twenty-eight days to notify the Office of State Revenue in writing of the changes. The Office of State Revenue may then make a reassessment of the stamp duty and you may have to pay the amount of duty you would have paid if the property was not your first home.

If you sell or lease the premises within the first twelve (12) months following settlement (subject to the exception above in relation to the seller staying at the property), then you will lose your entitlement to the concession and a reassessment must be completed.

Further information regarding the calculation of transfer duty rates, concessions and relevant thresholds can be found here.

If you have any questions regarding the first home buyers grant or are looking to purchasing a home and need a conveyancing lawyer, please contact one of our property lawyers today on (07) 4771 5664 or email us at law@connollysuthers.com.au