What happens when you are told you can’t afford the loan you need for your First Home?
The Government has now offered a Scheme called Boost to Buy where they will help you buy your own home and be part owner to your property. The Government can own up to 25% of an existing property, or 30% of a new property. Restricted places apply with over 50% allocated for Regional Qld.
You will need to be an Australian Citizen or Permanent Resident, First Home Owner, Minimum Deposit 2% of the Purchase Price, Maximum Income $225k for Couples and $150k for Single Applicant.
New lenders will join the Scheme in early 2026.
Some considerations which can mean you need to have extra savings – Stamp Duty may apply for all houses about $700k (existing home), and you will need to make sure you have savings for your legal fees.
You will not be able to buy a home through an auction, and you cannot refinance a home for renovations. Please consider this when you buying a home as this will come as quite a surprise for some home buyers if they find a property which requires some renovations.
As your property increases, so does the Government’s share of equity. This means that you need to pay out the equity based on the current value of the home at the time of settlement. Eg, Government ownership may be $270k at the time of buying the property based on $900k purchase price (30%), but when you sell a few years later, the property may sell for $1.4 million which means you need to pay the Government back $420k.
Due to the restrictions of this loan, this Scheme will not suit everyone.
Other states also have similar schemes, with different conditions so if you would like to know more about your state, please let me know.
If you would like to know more, please contact me at hello@georgefinancialservices.com.au
