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Victorian FHB grants rise by 29.4%

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Sarah Simpkins 7 minute read

The Victorian state government has dished out almost 30 per cent more grants to first home buyers year-on-year.

The Victorian State Revenue Office has published its annual review for the 2020-21 financial year, detailing its targeted relief and support measures for home owners and businesses.

The state’s First Home Owner Grant (FHOG) gives $10,000 to first home buyers purchasing or building a new home valued up to $750,000. In regional areas, the grant doubles to $20,000.

The number of grants paid under the program had leapt by 29.4 per cent from the previous year, with the government processing 22,099 grants, totalling $274.3 million.

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The rise in users for the FHOG has been consistent over the years, from $127 million in the 2016-17 year.

There had also been stamp duty exemptions for first home buyers’ properties valued at $600,000 or less, and concessions for properties valued up to $750,000.

Around 43,888 first home buyers had paid no stamp duty at all, 31 per cent more year-on-year, while 10,092 buyers’ transactions had received a concession, a rise of 25.6 per cent year-on-year.

The 53,980 stamp duty concessions and exemptions came to a total value of $885 million.

Meanwhile, Victoria had rewarded $130.5 million in principle place of residence concessions, for residents who bought their own home worth up to $550,000 and moved in within 12 months of settlement.

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The total number of concessions came to 63,777, rising by 18 per cent year-on-year.

Victoria’s State Revenue Office also reported the state received the highest number of applications for the federal government’s HomeBuilder program of any state, totalling 39,336.

Of those applications, 6,532 were for renovations and 32,805 were for new builds.

The annual review also showed the government-administered $960 million in coronavirus tax relief during FY21.

The state government had implemented 21 COVID-19 tax relief measures for businesses, home buyers and others; including land tax deductions and referrals, stamp duty deductions and waivers and payroll tax relief waivers.

The pandemic relief had included a stamp duty waiver of 50 per cent for residential property, with a dutiable value up to $1 million. Almost 50,000 transactions (47,865) had taken advantage, gaining $336 million in stamp duty relief.

A further 50 per cent concession had also applied for regional commercial and industrial properties for contracts entered into or after 1 January 2021, with 792 transactions seeing more than $30 million in stamp duty relief.

The government had also implemented land tax relief for commercial and residential landlords, as well as owner-occupiers.

It had received 32,397 applications for various types of land tax during the FY21 year, with a total of $247.5 million in relief going to impacted owners.

Victorian Treasurer Tim Pallas commented: “We’ve used our balance sheet to help Victorian households and businesses weather the storm during the pandemic, putting us in a position to bounce back strongly.

The pandemic has underscored the value of a secure, safe home to call your own, which is why we’re helping more Victorians get into the property market.”

Meanwhile, businesses had saved around $340 million through the New Jobs payroll tax credit, which the government has said helped 13,000 small and medium businesses to rehire staff, restore hours or create new jobs.

The Victorian government had also administered tax relief measures for home owners and businesses affected by the 2020 bushfires.

During the year, $570,518 in stamp duty relief was provided to those purchasing replacement homes after their properties were destroyed in the bushfires.

A 50 per cent concession for stamp duty on the purchase of regional, commercial or industrial property in certain affected local government and alpine resort areas applied to contracts of sale signed on or after 27 January 2020. Under this measure, buyers have received $3.4 million in stamp duty relief.

The government also gave $2.4 million in bushfire payroll tax relief to regional employers.

Victoria launched its Homebuyer Fund in October, which will see eligible buyers receive a contribution of up to 25 per cent towards the purchase price of their property, reducing their minimum required deposit to 5 per cent and cutting the need for lenders’ mortgage insurance.

In exchange for the Victorian government’s financial contribution, it will gain a share or proportional interest in the property.

For eligible Aboriginal or Torres Strait Islander home buyers, the contribution is up to 35 per cent, with a minimum required deposit of 3.5 per cent.

[Related: Hot Property: The biggest property headlines from the week 15-19 November]

Victorian FHB grants rise by 29.4%
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Sarah Simpkins

Sarah Simpkins

Sarah Simpkins is the news editor across Mortgage Business and The Adviser.

Previously, she reported on banking, financial services and wealth management for InvestorDaily and ifa.

You can contact her on This email address is being protected from spambots. You need JavaScript enabled to view it..

 

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