Everything you need to know about the new NSW first-home buyer $15,000 grant

NRL fans will have one eye on the grand final and the other browsing new home listings this grand final weekend as the NSW government’s more generous first-home buyer scheme kicks in Monday.

From October 1 first-home buyers in NSW will be eligible for a $15,000 grant from the NSW government to build or buy a new home under the first home owner grant (new homes) scheme.

The maximum total value of the new home cannot exceed $650,000. 

An application for the grant can be made through a lender or through the NSW Office of State Revenue (OSR).

Applications made through a lender will result in the grant paid on settlement if you are buying a new house or, if you are building a new house, on the first draw down on contracts to build.

You can apply through the OSR after your new house is built or upon settlement once you are registered on title.

The eight-page application form can be downloaded from the OSR website and includes a document checklist and lodgement guide.

In addition, first-home buyers of new homes are also eligible for stamp duty concessions under the first home-new home scheme, with no duty paid on a new home with a dutiable value of $550,000 or residential land valued at $350,000. These concessions have been in place since July 1.

First-home buyers looking for a new apartment in the Sydney inner-city hotspot of Waterloo might consider Becton’s Divercity project.

When finished, the development will have a total of 646 apartments and town homes.

Prices start from $445,000 for a one-bedroom and one-bathroom apartment, meaning potential savings on this purchase for first-home buyers of $30,515:  $15,000 (grant) + $15,515 (stamp duty saving).

Those in the market for detached home could consider Sekisui House’s the Hermitage in Gledswood Hills in Sydney’s south-west. This is a master-planned community development covering 120 hectares and featuring a central three-kilometre green corridor and more than 10 kilometres of bicycle and pedestrian walkways. There is also a proposed 27-hole golf course, cafes and community facilities.

Land starts from $260,000 for a 500-square-metre lot, meaning a potential savings of $22,590:  $15,000 (grant) + $7,590 (stamp duty saving).

Those buyers looking for a lifestyle block outside of the Sydney metropolis might consider a house-and-land package at Stockland's Brooks Reach residential community in Horsley, set against the backdrop of Illawarra Escarpment,

Land starts from $146,050 for a 308-square-metre lot, meaning potential savings of $18,603.50, while a house-and-land packages start from $299,000 for a three-bedroom, one-bathroom house with garage – potential savings of $23,955

The existing $7,000 first-home owner grant, available to all first-home purchases, ceases to apply where the eligible transaction is dated on or after October 1.

The new $15,000 applies to transactions dated after October 1 and is available up until December 31, 2013.  From January 1 2014 the grant will reduce to $10,000.

According to the NSW Office of State Revenue (OSR), which will administer the scheme, “a new home is a home that has not been previously occupied or sold as a place of residence, and includes a home that is a substantially renovated home and a home built to replace demolished premises”.

Substantial renovations of a building are defined as "renovations in which all, or substantially all, of a building is removed or replaced".

“The renovations may, but need not, involve the removal or replacement of foundations, external walls, interior supporting walls, floors, roof or staircases," says the OSR.

It warns that “substantial renovations do not include cosmetic work such as painting, sanding floors, replacing light fittings, or replacing curtains and carpets”.

Where applications are made for the grant new residential premises that have been created through substantial renovations of a building, the OSR will consider the application on a case-by-case basis.

There are a number of requirements that must be met by applicants, including that at least one applicant must be permanent resident or Australian citizen and each must be at least 18 years old.

Applicants may also be ineligible if they or their spouses (including de facto) have owned property in the past.

They must not have owned a residential property, jointly, separately or with some other person, in any state or territory of Australia before 1 July 2000.

In addition, on or after July 1, 2000, they must not have owned a residential property and occupied that property jointly, separately or with some other person in any state or territory of Australia for a continuous period of at least six months.

You will also be ineligible if you have received a first-home owner grant before in any state or territory.

Lastly, at least one applicant must occupy the home as their principal place of residence for a continuous period of at least six months, commencing within 12 months from the date they are registered on title if they are purchasing a new home or within 12 months of the construction completion date if they are building a home.

The total value of a new home will be calculated using the following methods:

For a contract of sale of a home, the total value is based on the greater of the following:

• the consideration for the eligible transaction
• the unencumbered value, as at the commencement date of the eligible transaction.

For a comprehensive home building contract, the total value is calculated by adding together:

• the consideration for the eligible transaction, and
• the value, at the commencement date, of the relevant interest of the land on which the home is to be built.

For a building of a home by an owner builder, the total value is calculated by adding together:

• the unencumbered value of the home, at the date the transaction is completed and the value, at the date the transaction is completed, of the relevant interest in the land on which the home is built.

The value of the relevant interest in the land on which the home is to be built is the greater of the following:

• the consideration paid or payable for the interest
• the unencumbered value of the interest.

There are also restrictions around whether applicants and/or their spouses (including de facto spouses) have owned property before.

All applicants and/or their spouse/de facto have not owned a residential property, jointly, separately or with some other person, in any state or territory of Australia before July 1, 2000.

All applicants and/or their spouse/de facto have not owned on or after July 1, 2000 a residential property and occupied that property jointly, separately or with some other person in any state or territory of Australia for a continuous period of at least six months.