Determining whether you qualify as a First Home Buyer is an important factor when purchasing a property in NSW. If you do qualify as a First Home Buyer, you may be eligible for a stamp duty exemption or concession through the First Home Buyers Assistance Scheme (“FHBAS”). Recent changes to the FHBAS from 1 July 2023 mean that eligible individuals can receive a full transfer duty exemption for properties up to and including $800,000.00 and concession for properties valued above $800,000.00 and less than $1,000,000.00. If you are buying vacant land, you may be eligible for an exemption for land valued up to and including $350,000.00 and concession for land valued above $350,000.00 and less than $450,000.00.
This can mean the difference in tens of thousands of dollars, so it is important to ensure that you understand the eligibility criteria, which is set out below:
Eligibility Criteria
To qualify as a First Home Buyer, Revenue NSW set out the following criteria that must be satisfied:
Exchange Date
To be eligible for a transfer duty exemption or concession in accordance with the updated thresholds, the Contract must have exchanged after 1 July 2023 and be for the whole of the property.
Adult Individual
Only individuals aged over the age of 18 are eligible for the FHBAS. This means that you will not be able to acquire property in a trust or company.
No Property Ownership
To be considered a First Home Buyer you cannot have previously owned residential property in Australia. You will not be eligible if you have owned residential property in any manner including where you have inherited property as a beneficiary, or co-owned property with another person.
No Previous Concessions or Exemptions
If you have previously received either a First Home Buyer concession or exemption, you will no longer be treated as a First Home Buyer.
Australian Citizen or Permanent Resident
At least one of the persons acquiring the property must be an Australian citizen or permanent resident. Where you are buying the property with someone who is not eligible it is referred to as a shared equity arrangement. Shared equity arrangements have additional requirements that must be met.
Home Occupation
The requirement for living in the property has changed from 1 July 2023 and now requires at least one of the eligible First Home Buyers to continuously live in the property as their principal residence for a period of 12 months within 12 months of settlement. This has increased from the previous requirement of living in the property for 6 continuous months within 12 months of settlement. Members of the Australian Defence Force at the time of exchange of Contracts may not need to meet these requirements.
The above criteria can be confusing, and it can be hard to know where you stand. It is recommended that you seek independent legal advice so that your specific circumstances can be accounted for. If you have any questions regarding whether you would be considered a First Home Buyer or need any assistance in purchasing a property, please contact the office on 4944 3322.
