New South Wales Premier Dom Perrottet has flagged a new scheme that will help New South Wales first home buyers. The new scheme will be in addition to the existing First Home Owner’s Grant of $10,000 for building a new home, and the existing First Home Buyer Assistance Scheme, which gives first home buyers either a transfer duty exemption or concession, saving thousands of dollars.
Read on to find out everything you need to know about the proposed new scheme for New South Wales first home buyers.
Shared equity scheme for first home buyers
The scheme is still under development but the idea is that the State government will hold a level of equity in the home that can be either repaid in instalments or when the property is sold.
Details of the New South Wales scheme are yet to be released, but with the State election only a year away, it’s likely that first home buyers will be targeted with policies designed to ease the affordability crisis.
The Victorian government trialled a shared equity initiative last last year with the following features:
- the government contributing up to 25% of the purchase price in return for equity in the property.
- first home buyers only needing to provide a deposit of 5% of the purchase price, and not needing to pay lenders’ mortgage insurance (see below for an explanation of how you can avoid it in New South Wales too by taking advantage of the federal government’s First Home Loan Deposit Scheme).
The federal government’s First Home Loan Deposit Scheme
Lenders will charge you LMI if you can’t provide a deposit of at least 20% on the property you want to buy. The cost of LMI varies, but it can be $10,000 or more on a typical loan.
If you’re eligible for the First Home Loan Deposit Scheme, you only need to come up with a deposit of 5%. The federal government guarantee can help you to qualify for a loan to buy a home years sooner.
How we can help
If you’re a first home buyer looking to buy residential property in the Newcastle, Maitland and Lake Macquarie areas and you need finance, talk to us. Our licensed and experienced brokers at Wisebuy Investment Group can help you to work out your eligibility for any State or federal government assistance.
We’ll take the time to find out your individual needs before matching you with a suitable lender and helping you to get the right loan. We work with more than 60 lenders in the Australian market, and we can help you with your loan application. Importantly, we work for property buyers, not lenders.
Contact us today for an obligation-free chat to find out more. We’d be happy to answer any questions you have and to explore your finance options with you.