How the Queensland first home owner grant works

As you might know, the Queensland First Home Owner’s Grant is a government initiative that helps first home buyers get their foot in the door sooner, so to speak, by helping them buy their first home with a smaller budget. The grant for $15,000 contributes to buying or building a new house, apartment or townhouse that is worth less than $750,000.

The process of applying (or even checking if you’re eligible) can seem quite daunting. Luckily, we’ve got a handy little guide to get to you started:

Am I eligible?

To be eligible for the first home owner grant:

  • You must be at least 18 years of age,
  • You must be an Australian citizen or permanent resident (or applying with someone who is),
  • You or your partner must not have previously owned property in Australia that you lived in,
  • You must be buying or building a brand new home,
  • The value of the home including the land is less than $750,000 and;
  • You must move into the new home as your principal place of residence within 1 year of the completed transaction and live there continuously for 6 months.

You can apply for the loan:

  • Within 1 year of taking possession of a new home that you have bought and have the registered title for, or
  • Within 1 year of a new home being completed when a contract to build has been signed (ie. when the final inspection certificate is issued), or
  • Within 1 year of a new home being completed if you are an owner-builder (ie. when the final inspection certificate is issued).

When am I not eligible?

You’re not eligible for the first home owner’s grant when you:

  • Buy a property equal to or worth more than $750,000,
  • Are a trust or a company,
  • Have received the grant before,
  • Held an interest in a residential property before 1 July 2000, regardless of how the property was used, and/or;
  • Buy or build your new home with financial help from a person who is not eligible for the grant, who will be staying in the home often, for long periods, or genuine family reasons. It’s important to note that money borrowed from a bank or lending institution is not considered financial help.

If you feel like you tick any of the above, then you, unfortunately, cannot receive the grant.

So, what counts as a new home?

A new home is a brand-new dwelling that has not previously been occupied or sold as a place of residence. In some select situations, the grant is available for established homes that have undergone extensive renovations before it was bought, or homes that have been moved from one site to another (ie. kit homes, manufactured homes).

For most buyers, however, this will mean buying a house, apartment or townhouse which has been built in the last couple of years or will be built within a couple of years.

What about investment properties?

This one is a little complicated, but essentially, if you’ve owned interest in residential property (since 1 July 2000), that has only been used for investment purposes, you may still be eligible for the grant — but only if you’ve never lived in that investment property. You can prove this by using evidence that covers the entirety of the time you have owned the investment property. Evidence accepted includes tenancy/lease agreements, electricity/phone/gas accounts, and/or tax return details.

I’m eligible for the grant. What else do I need to know?

First and foremost, double check that both you and anyone who will own any part of the new home are eligible. Then, fill out only one application per home, rather than per person (because only one grant is payable per new home). Remember, your spouse has to be included in the form, even if they are a non-applicant. We recommend checking out the official Queensland Government information page to ensure you haven’t missed anything.

It’s worth remembering that the grant is paid at different times depending on how and when you apply, as well as the type of property you will be buying. The Queensland Government doesn’t recommend using it as a deposit for this reason, and we’d have to agree with them. While you don’t need a deposit to apply for the grant, because the grant is paid per new home and not to each of the applicants, it can be quite limiting.

When you receive the money can differ depending on how you apply for the loan. Payment usually occurs at settlement (particularly for off-the-plan purchases), on the first drawdown of funds, or on the receipt of the final inspection certificate (if you are an owner-builder) if you apply through a bank or lending institution. If you apply through the Office of State Revenue, then it’s a bit more complicated. Off-the-plan buyers will get the grant when they have a registration confirmation statement showing their name on the title of the property. If you’re building, then you’ll receive the money when you have a final inspection certificate. When you purchase through vendor finance contract, then you will receive the grant when you own the home under the contract. If you decide to buy through instalment purchase contracts, then you will only get the money after the contract has been operating for one year, and you’ve paid 10% of the purchase price (or $20,000, whichever is greater) without defaulting on the contract and you’ve occupied the home as your principal place of residence.

Then, you need to make sure you don’t lose the grant. This means that you must move into the come within 1 year of the completed transaction, and then live in the home for at least 6 months, continuously. You’ve 14 days to let the government know if you can’t move into the home or have to move out before the 6-month mark, and depending on circumstances, may have to pay back the loan.

This is a lot to take in, we know. Luckily, you don’t have to go through this process alone. There are industry professionals who can help guide you through the ins and outs of buying your first home, and PropertyMash is one of them. We’ve got the know-how (and the industry contacts) to help you learn everything you need to know, and we regularly host events to help buyers stay up-to-date with the laws and grants surrounding the purchase of your first home. Click the button below to learn more.

Written: 27 February 2020

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