The Australian budget is out, and there are three measures targeting home ownership in financial year 21/22, which is fantastic news if you are looking to get on the property ladder!
Here is a brief explanation of how some or all of these may help you:
1. New Home Guarantee Expansion
The New Home Guarantee will be expanded again, providing an additional 10,000 places in 2021-22. This is in addition to the 10,000 spots under the First Home Loan Deposit Scheme (FHLDS). The initial spots for this year were snapped up, but this will be a welcome boost to get more people into their first homes. The New Home Guarantee scheme helps first home owners build or purchase a new home with a deposit as low as 5 per cent, without having to pay Lenders Mortgage Insurance (LMI), which can be an expensive barrier to home purchase for those with a small deposit.
2. Family Home Guarantee
This is a new measure to help single parents purchase property, and is a measure not limited to first home buyers. Starting 1st July 2021, the new guarantee aims to support divorced or separated parents with dependent children by enabling them to purchase a home sooner with a deposit of as little as 2%. The government will guarantee up to a maximum of 18% of the property purchase price, allowing the applicant to get a loan without paying LMI. The family home guarantee does extend to both new and existing homes and is not limited to first home buyers.
3. First Home Super Savings Scheme
From July 1st 2021, the maximum amount of voluntary contributions that can be released under the First Home Super Saver Scheme will be increased from $30,000 to $50,000 of savers’ voluntary contributions. If these funds are then withdrawn to purchase a first property, the funds will only be taxed at the Super tax rate of 15%, and not your marginal tax rate. To find out more about this scheme, click here.
So there you have it! More ways to save up for a property, whether it be a first home under schemes 1 and 3, or for a home as a single parent in scheme 2.
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If you are interested in a home loan, check out our recently launched Raiz Home Ownership. Borrowing to buy a home can seem complicated, especially when it’s your first time. But with Raiz Home Ownership, our personable approach gives you access to a qualified Raiz home specialist who will guide you through the maze of mortgage products from up to 50 banks and lenders. Our specialists will also assist you in receiving the incentives available for first home buyers, which can go a long way to helping you get on the property ladder.
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