Home Owner Grant, Construction Grant and Stamp Duty Concession Update
We regularly receive questions in relation to the government grants that are available when purchasing a property in Adelaide. While everyone is familiar with the First Home Owners Grant, we find clients are never quite sure exactly how much they are entitled to. In addition, many people are unaware they may qualify for additional grants or concessions when buying a new home, even if they’re no longer a first home buyer.
We’d like to shed some light on the different types of grants and what you need to do to qualify for each one.
First Home Owners Grant [FHOG]
The FHOG applies to the purchase or construction of a residential property, including a house, flat, unit, townhouse or apartment that meets local planning standards anywhere in South Australia. The FHOG currently applies to both new and established homes, but will cease for established homes from 1 July 2014.
The residential property must be occupied as each applicants principal place of residence property for a continuous period of at least six months commencing within 12 months of date of settlement for contracts to purchase, or the date construction is completed for owner builders or contracts to build.
The FHOG for established homes is currently $5,000, and for new homes it’s $15,000.
Housing Construction Grant [HCG]
For first home buyers, this is in addition to the FHOG. As part of the 2013-14 State Budget handed down on June 6th the Government announced they were extending the HCG for a further six months until 31 December 2013. The HCG applies to:
- contracts to purchase a new home entered into between 15 October 2012 and 31 December 2013 [inclusive];
- comprehensive home building contracts for new homes entered into between 15 October 2012 and 31 December 2013 [inclusive] where the contract states that the building will be completed within 18 months of commencement or the building work is actually completed within 18 months of commencement;
- contracts for the purchase of a new home off-the-plan entered into between 15 October 2012 and 31 December 2013 [inclusive] where the contract states that the building work will be completed on or before 30 June 2015 or the building work is actually completed on or before 30 June 2015; and
- owner builders where construction of the new home commences on or after 15 October 2012 and before 1 January 2014.
The HCG is available to natural persons, companies and trusts. The new home may be intended for occupation as a place of residence or investment. Unlike the FHOG, the new home does not need to be resided in, nor does the applicant need to be an Australian citizen or permanent resident.
There are no restrictions on the number of times a purchaser can apply for the HCG, regardless of whether a person purchases or builds a new home alone or together with others. Previous recipients of a FHOG are also entitled to the HCG.
A HCG of $8,500 is available for new homes where the market value does not exceed $400 000, and phases out for new homes with a market value between $400 000 and $450 000 at a rate of $17 for every $100 in excess of $400 000.
Off-The-Plan Apartment Concession [OTPAC]
The off-the-plan apartment concession [OTPAC] provides a full stamp duty concession on a transfer of a new apartment or substantially refurbished apartment for a contract entered into from 31 May 2012 to 30 June 2014. The Concession applies to purchases of off-the-plan apartments located:
- within the area of the Corporation of the City of Adelaide;
- on any land within the area where the Bowden Redevelopment project [Bowden Village]; or
- on any land located within the area known as 45 Park, Gilberton.
No stamp duty will be payable on the purchase of apartments bought through a qualifying off-the-plan contract entered into between 31 May 2012 to 30 June 2014 where the apartment has a market value of $500 000 or less. If the apartment has market value greater than $500 000, the purchaser will be entitled to a maximum stamp duty concession of $21,330.
Home Buyer’s Grant Summary Table
|Grant Type||Established Homes*||Status|
|First Home Owners Grant [FHOG]||$5,000||Ends 30 June 2014|
|TOTAL [established home buyer – 1st home]||$5,000|
|Grant Type||New Homes*||Status|
|First Home Owners Grant [FHOG]||$15,000||Ongoing|
|Housing Construction Grant [HCG]||$8,500 [max]||Ends 31 Dec 2013|
|Off-The-Plan Apartment Concession [OTPAC]||$21,330 [max]||Ends 30 June 2014|
|TOTAL [new home buyer – not 1st home]||$8,500 [max]|
|TOTAL [new home buyer – 1st home]||$23,500 [max]|
|TOTAL [approved apartment – not 1st home]||$29,830 [max]|
|TOTAL [approved apartment – 1st home]||$44,830 [max]|
As you can see from the table above it depends on your exact situation as to how much you could possibly receive in way of property grants and concessions.
If you are a first home buyer looking to purchase an established property you will only qualify for a $5,000 grant. If you are a first home buyer and you wish to purchase or build a new property you will qualify for up to $23,500 in grants.
For those who have previously purchased property you will have to make do with the Housing Construction grant of $8,500. If however you’re a first home buyer and you want to purchase an apartment in either the city, 45 Park or the Bowden Village you have the opportunity to get up to a very tidy $44,830 in grants and concessions.
If you would like further information or want to discuss your situation in more detail please don’t hesitate to contact us anytime.
Sam & Matt
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