The Home Guarantee scheme (5% deposit scheme) will continue with 10,000 spots in the program each year to 30 June 2026. Buyers only need a minimum 5 per cent deposit and they will not need to pay lenders mortgage insurance (LMI) on a 95 per cent home loan. The program will be open to First Home Buyers who are Australian citizens, who are at least 18 years of age. Permanent residents are not eligible. Single applicants with a taxable income of up to $125,000 per annum for the previous financial year and couples with a taxable income of up to $200,000 per annum for the previous financial year, as shown on the Notice of Assessment (NOA) issued by the Australian Taxation Office for the previous financial year. Participants must live in the property for at least the first 12 months. It is not open to investment properties. Couples are only eligible for the First Home Guarantee if they are married or in a de-facto relationship. Other individuals buying together, including siblings, parent/child or friends, are not eligible for the First Home Guarantee.
Help to Buy scheme
The government will spend $324.6 million over four years to establish the Help to Buy scheme with 10,000 spots each financial year, for people on low to moderate incomes, to purchase a new or existing home with an equity contribution from the Government.
The Help to Buy shared equity scheme, involves an equity contribution from the federal government of up to a maximum of 40 per cent of the purchase price of a new home and up to a maximum of 30 per cent of the purchase price for an existing home.
Buyers only need a minimum 2 per cent deposit and they will not need to pay lenders mortgage insurance (LMI) on their home loan. The program will be open to Australian citizens over 18 years of age with a taxable income of up to $90,000 per annum, or for couples with a combined income of $120,000, who currently don’t own or have an interest in a residential property. It is open to all home buyers (including first home buyers and those who have previously owned a home), who must live in the property for at least the first 12 months. It is not open to investment properties.
A Defence Home Ownership Assistance Scheme
The Government is also committing $46.2 million to assist current and former ADF members to purchase their own home through the Defence Home Ownership Assistance Scheme.
This will support veterans and Australian Defence Force members to purchase a home through monthly subsidies on mortgage interest payments.
Reducing downsizer age
The Australian Government is extending the exemption of home sale proceeds from pension asset testing from 12 months to 24 months. This will give pensioners more time to purchase, build or renovate a new home before their pension is affected. In addition, the Australian Government is expanding access to downsizer superannuation contributions for people aged 55 to 59.
“The downsizer contribution allows people to make a one-off post-tax contribution to their superannuation of up to $300,000 per person from the proceeds of selling their home,” the Budget document reads.
“Both members of a couple can contribute, and contributions do not count towards non-concessional contribution caps.
“This measure provides greater flexibility to contribute to superannuation and aims to encourage older Australians to downsize sooner to a home that better suits their needs, thereby increasing the availability of suitable housing for Australian families.”
Building a million homes
The Treasurer has said that a “high priority” for the government was bringing online “more affordable housing closer to where the jobs and opportunities are”. This includes the $10 billion Housing Australia Future Fund (to be managed by the Future Fund Management Agency) to build 30,000 social and affordable homes over five years.
The Budget also earmarks an additional $350 million in funding to help incentivise superannuation funds and other institutional investors to build another 10,000 affordable homes over five years from 2024.
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