REAL ESTATE | Fancy owning your first home in Port Douglas or surrounds?

REAL ESTATE

Rosie Wang

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A new Government incentive could get you on the property ladder sooner!


Last month (January 2020), the Federal Government launched a new scheme to help first home buyers buy their first home. It is known as the First Home Loan Deposit Scheme.

This is good news for anybody in Port Douglas and surrounds thinking about getting on to the property ladder.

Up to now, banks have preferred upwards of an 8% deposit to cover extra costs which has included the lender’s Mortgage Insurance costs. This is required if a mortgage deposit is under 20% of the purchase price.

Under this new Scheme, eligible first home buyers can be issued a guarantee allowing them to purchase a home with a deposit of as little as 5% without needing to pay Lenders Mortgage Insurance.

This initiative will help you as a first-time buyer ‘get over the line’.

As a guide you can calculate the amount of mortgage insurance you would pay on your loan on this easy link.

Under this Scheme, the National Housing Finance and Investment Corporation (NHFIC) provides a guarantee to the lender of up to 15% of the value of an eligible home.

So how is this worked in?

In the example shown in the table below, if you purchased a property for $400,000 (that’s the maximum property price allowed under the Scheme in the Douglas Shire area) then you could save around $12,500 in Lenders Mortgage Insurance.


What type of property can be bought under the First Home Loan Deposit Scheme?

  • An existing house, townhouse or apartment
  • House and land package
  • Land together with a separate contract to build
  • a home;
  • Off-the-plan apartment or townhouse.

1. What is the general criteria to be eligible?

  • You must be Australian citizens. Permanent residents are not eligible
  • At least 18 years of age
  • Your incomes need to under these thresholds to be eligible:
    • Singles earning a taxable income of up to $125,000 per annum (before tax) in the previous financial year
    • Couples can earn a combined taxable income of up to $200,000 per annum (before tax)
  • Relationship status – Couples are only eligible for the Scheme if they are married or in a de-facto relationship. This means you can’t buy with siblings, parent/child or friends.


2. What are the property requirements to be eligible?

  • You must not have previously owned or had any interest in a residential property, either separately or jointly with someone else (this includes residential strata and company title properties, regardless of whether it was an investment or owner-occupied property and whether it was ever lived in).
  • Applicants must intend to move into and live in the property as their principal place of residence (they must be owner occupiers).
  • Must move into the property within 6 months from the date of settlement or, if later, the date an occupancy certificate is issued.
  • Continue to live in that property for so long as your home loan has a guarantee under the Scheme.


3. How much of a deposit do I need saved to be eligible for the First Home Loan Deposit Scheme?

  • Applicants must have a deposit of between 5% and 20% of the property’s value;
  • Your maximum property purchase price is subject to the suburb and postcode of the property you want to purchase. Here in Port Douglas and surrounding areas it is $400,000.


From 1 January, CBA and NAB have been offering loans under the Scheme. From 1 February, 25 smaller lenders will join the Scheme’s lending panel.

NHFIC is releasing 10,000 First Home Loan Deposit Scheme guarantees this financial year. Don’t worry about missing out, as there are another 10,000 places being made available from July 2020 for the next financial year.

For further information you can check the Government information on these:
https://www.nhfic.gov.au/what-we-do/fhlds/how-to-apply/ 
https://www.nhfic.gov.au/what-we-do/fhlds/eligibility/ 
https://www.nhfic.gov.au/media/1238/fhlds-faqs.pdf 

Buying your first home can be a daunting task. Pop into your local real estate agent in Port Douglas or Mossman who can guide you through the maze to helping you make your first step onto the property ladder that much easier.


Rosie Wang is a Real Estate Agent with Ray White Port Douglas 


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