Big news! Victoria has launched a new $500 million home-buyer fund. And the best part is that it is not just open to First Home Buyers.
How does it work?
The Victorian Government will pay 25% of the property purchase price if the eligible borrowers have a 5% deposit.
The Victorian Government, however, will then also own 25% of the property. Don’t worry though, you will be able to purchase the Victorian Goverments holding in your property down the line at the prevailing market price. The participant puts in the 5% deposit and finances, Victoria stumps up 25%, and the remaining 70% can be borrowed by eligible participants via one of the mortgage lender participants, which currently include Bank Australia and Bendigo Bank.
Aboriginal and Torres Strait Islander home buyers can buy with a deposit as low as 3.5% and receive a government contribution of up to 35%, in exchange for an equivalent share in the property.
Am I eligible?
To be eligible to participate, home buyers need to:
- Be an Australian citizen or permanent resident over the age of 18 years
- Not currently have an interest in a property
- Have a gross annual income of $125,000 per annum or less for individuals or $200,000 or less per annum for joint applicants
- Be a person (that is, not an organisation, company, trust or other body or entity)
- Occupy the purchased property as your principal place of residence
- Not purchase the property from a vendor who is related
- Not own any interest in any land at the time of purchase (including as trustee of a trust or beneficiary under the trust)
- Not be acting as a trustee of a trust
- Not be a shareholder in any corporation (other than a public company) that owns any land
- If subsequent assessments by the state and a participating lender are approved, eligible participants must become registered owners of the property they purchase.
Which locations are eligible to buy?
Eligible participants can purchase in any location in metropolitan Melbourne and will be provided with regional Victorian options when searching for a property. Property price caps are $950,000 in metropolitan Melbourne and Geelong, and $600,000 in regional Victoria excluding Geelong.
The purchase can be for an existing or new property provided that a certificate of occupancy has been issued prior to the date of the contract of sale, meaning that off-the-plan property purchases are not eligible.
The property must be vacant when purchased, or, if under a lease, the lease must expire within 12 months of the acquisition date and any tenants must vacate the property.
What does this mean for Australian residents outside of Victoria looking to take advantage of this fund?
Because you will need to live in the property to participate in the fund, you will need to either move into the property immediately if it is vacant upon purchase, or directly following the end of an existing lease that does not exceed twelve months from the property purchase date. In either case, a move to Victoria is required.
The Victorian Government expects to help over 3,000 Australians own their dreams
It is never too early or too late to chase your dreams. If you are on the hunt for a property purchase in Victoria and do not currently own property, this $500 million fund may just be the helping hand you are looking for 😊
Buying property is one of the biggest money decisions you’ll make in your life, so put in the work to get it right. Get good help around you so you cover all your bases and can confidently buy property knowing you’re on the right track from the moment you make your purchase! If you would like to find out more about Raiz Home Ownership, please contact the team at email@example.com, or register your interest.
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