Buying a home in Victoria will be easier from 1 July 2017 with the State Government announcing changes to help first home buyers. Let's take a look at them.
1. STAMP DUTY ABOLISHED FOR PROPERTIES VALUED BELOW $600,000
From July discounts will also be available for property purchases between $600,000 and $750,000 on a sliding scale, regardless of whether they are new or established homes.
2. VACANT HOUSES WILL BE TAXED
To make housing more affordable, the Government will also introduce a 1 per cent tax on vacant residential property to target empty properties in Melbourne's inner and middle suburbs.
Premier Daniel Andrews said "this will send a really strong message to people that if you are effectively banking an empty property and denying that to the market and contributing to the lack of supply, then there's something you can do about it".
3. SHARED OWNERSHIP SCHEME
A new $50 million pilot scheme, HomesVic, will target first home buyers who are able to meet regular mortgage repayments, but because of rising rental costs, haven’t been able to save a big enough deposit.
Under the scheme, to be introduced in January 2018, HomesVic will co-purchase up to 400 homes, taking an equity share of up to 25 per cent in these properties.
It will be available for both new and existing homes.
By allowing homebuyers to purchase less than 100 per cent of the property, they will require a smaller deposit and are able to enter the market sooner. In the long term, it will also mean having a smaller loan to service.
Eligible applicants will include couples earning up to $95,000, and singles earning up to $75,000. Buyers will need to have a 5 per cent deposit.
The pilot will be tested across the state, and when the properties are sold, HomesVic will recover its share of the equity.
4. ASSISTANCE FOR FIRST HOME BUYERS IN GOVERNMENT LED DEVELOPMENTS
The second scheme, Buy Assist, aims to further improve buyers’ chances of owning their own home.
The state government will contribute $5 million to this national, community sector, shared equity scheme, Buy Assist.
Buy Assist will help deliver an additional 100 shared equity homes and help low to medium income households get a foothold in the property market.
The Government is also set to give first home buyers priority in government-led urban renewal developments, with at least 10 per cent of all properties allocated to first time buyers.
This approach will be used for the first time at the Arden development.
The plan to develop the 56 hectare site Arden, announced by the state government last year, could be home to around 15,000 people. Under this policy 1,500 of those could be first home buyers.
The Government will also consult with first home buyers, industry and the community about the design and implementation of measures to support first home buyers in private developments, especially those close to jobs and transport.
So there you have it. A raft of changes that will help the first home buyers amongst us.
If you would like to know how much you can borrow or have any other questions, please feel free to call us on 0487 344 352 for a free no obligation service.