We understand that the path to buying your first home can feel hard. Median house prices in Melbourne have risen by over 40% since 2012 and navigating the process can feel overwhelming and defeating. Here we go through a few of the government incentives on offer to help you in the process.

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The nitty gritty of what you need to have saved: Typically a deposit of 20% is ideal as then you wont need to pay lenders mortgage insurance. Under the governments First home Guarantee you can purchase your first home with a deposit as low as 5% without needing to pay lenders mortgage insurance.

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What is lenders mortgage insurance? It is a one- insurance payment that protects the lender in the event you default on your home loan repayments. It is usually applicable when borrowing over 80% of the value of the property.

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Know what can affect your lending capacity: Personal loans, credit cards, student debt and dependents will all effect the way the bank views your lending capacity.

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Who is eligible for the first home Guarantee?

Income test – singles with a income less than $125,000 and couples less than $200,000

Join applications – Any two eligible people can apply together including friends, siblings or family

Prior ownership - You cannot of owned or held interest in property in Australia

Citizenship – You must be an Australian citizen or Permanent resident

Owner Occupied – you need to live in the property within 6months of owning it

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What government incentives are available to first homebuyers?

The First home buyers Super saving scheme allows you to add $30,000 to your super tax free for the purpose of purchasing your first home

A $10,000 first home owner grant is available when you buy or build your first new home

If you are buying a home under $600,000 you will pay no stamp duty. Stamp duty concessions are then on a sliding scale up to $750,000.

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