First home buyer grants and schemes explained

If you are buying your first home, there are three kinds of help you may be able to get: a cash grant from your state or territory, a reduction in stamp duty, and a federal guarantee that lets you buy with a smaller deposit. They can be combined, but each has its own rules, and the details change from year to year, so check the current thresholds with your state revenue office before you count on anything.

The First Home Owner Grant

Every state and territory runs a version of the First Home Owner Grant. It is a one-off payment, usually only for buying or building a brand-new home rather than an established one, and it is capped at a property value that differs from state to state. You apply through your lender or directly with the revenue office, and the money is generally paid at settlement or when construction starts.

The catch is the new-home requirement. If you are looking at an established house or apartment, the grant will not apply, and it is worth knowing that before you decide between a new build and an older home.

Stamp duty concessions

Stamp duty is often the biggest single cost after the deposit, and most states waive or reduce it for first home buyers below a certain purchase price. Unlike the grant, the concession usually applies to established homes as well as new ones. The thresholds matter: buying just above the cut-off can cost tens of thousands of dollars more than buying just below it, so factor them into your budget early.

The federal deposit guarantee

The Australian Government's home guarantee scheme lets eligible first home buyers purchase with a deposit as low as five per cent without paying lenders mortgage insurance. The government guarantees part of the loan to the lender instead. Places are offered through participating lenders, and there are price caps by location and income limits for applicants.

Putting them together

A typical first home buyer in a new apartment might use the grant towards the deposit, pay reduced or no stamp duty, and take up the guarantee to avoid mortgage insurance. Someone buying an established house might only qualify for the stamp duty concession and the guarantee. Either way, the combination can shift what you can afford by a meaningful amount.

Two practical tips. First, talk to your lender or a broker about the schemes before you start inspecting, so you know which properties are inside the thresholds. Second, keep an eye on the timing: eligibility often depends on the contract date, not the settlement date, so a contract signed a week later can fall under different rules.