Australian governments have been courting first home buyers with financial incentives since the introduction of the GST in 2000. Recently, the NSW government shifted the focus to new home investment in a bid to increase the state’s housing stock, particularly in urban fringes. Ironically, the move comes just as other states are closing off eligibility for new home funding.

In a move that has received mixed reviews; first-time NSW buyers looking to secure an existing property will now miss out on the $7,000 First Home Owner Grant. However, those interested in buying or building a new home will attract quite the windfall.

Here’s a snapshot of the latest state and territory moves to entice first home buyers.

NSW
In the throes of a housing shortage, NSW has introduced a raft of incentives to boost investment in new homes.

The financial incentives include:

• A $5,000 New Home Grant from July 1 for non-first home buyers of new properties up to $650,000.

• No stamp duty on first homes up to $550,000 and, from July 1, reduced concessions for those up to $650,000 to compensate for the increased average home cost in Sydney.

• A $15,000 grant from October 1 for first home buyers of new properties, reducing to $10,000 in 2014.

If all the concessions and incentives were to apply, a NSW first-home buyer could land more than $35,000 in incentives, the most generous package in the country.

The state government has also introduced new infrastructure plans to encourage investment in new homes in outer Sydney, the Central Coast and North Coast, accelerated land releases and reduced planning approval red tape for new developments.

QLD

First-time buyers can still receive the $7,000 grant on homes under $750,000. However, just when NSW opens the door to incentivise new home investment, Queensland and other states have closed it. Queenslanders building a new home still have until September 1 to apply for the $10,000 Building Boost Grant, providing contracts were dated between August 1, 2011 and April 30, 2012.

The state government continues to shave $8,750 off the stamp duty on first homes costing up to $505,000, reducing on a sliding scale and cutting out at $550,000.

VIC

Victoria still offers the $7,000 First Home Owner Grant but ceased its First Home Boost for new homes on June 30 this year.

However, the government is phasing in a 50 per cent reduction in land transfer duty for first buyers on homes up to $600,000 in value. A 20 per cent cut was introduced for first home buyers on July 1, 2012, with an extra 10 per cent discount due on January 1 next year. Additional 10 per cent reductions will be introduced on January 1 and September 1, 2014.

ACT

The ACT probably offers the leanest incentives for first buyers. The standard First Home Owners Grant of $7,000 still applies, along with an offer to defer the payment of transfer duty.

SA

The $7,000 First Home Owner Grant remains on offer for established homes costing up to $575,000 and there is no end date yet on this Grant. The good news in South Australia is that the state’s First Home Bonus Grant - a payment of up to $8,000 for new homes - has been extended until 1 July 2013.

WA

In a state riding high on the wave of the mining boom, first home buyers can fork out up to $750,000 for a property and still receive the standard $7,000 grant. North of the 26th parallel (around Carnarvon), buyers can spend up to $1 million and qualify for the hand out, further reflecting the state’s resources surge. However, it’s hard to fathom how much help several thousand is against properties with such hefty price tags.

At the other end of the spectrum, Western Australia first home buyers thrifty enough to land a property for $400,000 or less can pick up $2,000 from the State Government to help cover the incidental costs of buying a home, such as duties and legal fees.

TAS

Not much on offer here for first home buyers other than the standard $7,000 grant. However, there is no cap on property values for first home buyers to receive the payment.

NT

First-time Territory buyers can spend up to $750,000 on a property and quality for the First Home Owner Grant. They can also access fairly generous discounts on stamp duty. A First Home Owner Concession of up to $26, 730 (or the duty on the first $540,000 of a property) is available on properties valued up to $750,000 or on land only up to $385,000. There is no limit on construction costs.

To stay across government assistance for first home buyers in your market, visit www.firsthome.gov.au and select your state or territory.