First Home Owners on the Rise Due to State and Territory Incentives blog image

First Home Owners on the Rise Due to State and Territory Incentives

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Thanks to state and territory incentives such as first home buyer grants and stamp duty concessions, first home owners across Australia are on the rise.

Over the past few years, the numbers for first home buyer activity was tracking below average. However, property research firm CoreLogic’s new data shows that the share of first home owners in the Australian property market increased by 4.6% in the past year.

The data also showed that the volume of loans had increased by 33.1% specifically for first home buyers. In February 2018, there were 8,782 housing finance commitments nationwide. In addition, first home owners covered for 17.9% of all owner occupier commitments compared to February 2017’s 13.3%.

Number and share of first home buyer finance commitments

According to Cameron Kusher, CoreLogic RP Data’s senior research analyst, varying trends have materialised due to the recent incentives across the individual states and territories.

New South Wales and Victoria introduced attractive incentives that contributed to the increase in the first home owner segment. New homeowners in New South Wales increased by 103.3% since last year. Also, NSW’s first home owners now account for 15.1% of all housing finance commitments which is up from last year’s 7.5%. This has been the biggest share of first home owners in NSW since October 2012.

Victoria’s number of first home buyer finance commitments also rose by 38.6% compared to the previous year. There were 2,619 finance commitments to first home buyers in February 2018. This contributed to 18.3% of finance commitments to first home owners compared to 13.9% a year earlier.

The Australian Capital Territory also saw a great increase of 177.7% from the previous year (261 first home buyer housing finance commitments), and first home buyers attributed to 25.6% share of all owner occupier commitments in February 2018. This has been the highest share in the ACT for first home owners since October 2009.

In Queensland, the number of housing finance commitments slightly increased by 3.8% from the previous year. There were 1,839 commitments over February 2018 which accounted for 19.3% of the market compared to the previous year of 17.6%.

South Australia saw 443 first home owner housing finance commitments in February 2018. This number was lower compared to the numbers recorded late last year. However, it was an increase of 17.8% compared to the previous February. First home buyer activity also rose from 10.5% to 13% in the past year.

The Northern Territory saw only 52 first home buyers in February 2018. However, this number is 26.8% higher than what it was February last year. First home buyers in this federal territory account for 19.4% of all owner-occupier commitments which rose from 14.7% share in the previous year. Nonetheless, this share is currently heading downwards in NT.

Also slightly increasing, Tasmania’s first home owners account for 13.9% share of all housing finance commitments compared to last year’s 13.8%. Even though the number of first home owners increased, it also shows that first home buyers are not that currently active in TAS.

Western Australia, on the other hand, had -0.1% fewer first home buyer finance commitments this February 2018. Even though the state had only 1,185 first home buyer finance commitments in February 2018, first home owners still accounted for 25.0% of all owner-occupier housing finance commitments in contrast to the previous year’s 22.2%.

Investment opportunities for young Australians

Even with the general slowing of demand in the investment segment, Kusher believes that this will open up opportunities in the property market that were previously unavailable to Australian millennials, especially outside Sydney and Melbourne.

He adds that first home owners outside of Sydney and Melbourne will increase in the coming months because of the low mortgage rates and fewer affordability constraints. He claims that “the outflow of people from NSW to other states and territories is continuing to rise which may result in increases in first home buyers elsewhere.”

Help boost your deposit with a First Home Owner Grant (FHOG)

If you’re considering purchasing your first home, you may be eligible for a First Home Owner Grant (FHOG) to help raise your deposit. The FHOG is a government initiative introduced back in 1st July 2000 where the state or territory governments pay the grant on behalf of the federal government.

The FHOG conditions differ depending on where you live. Some states and territories offer stamp duty exceptions and concessions, while others also have additional grants especially in regional areas.

The First Home Owner Grant is only applicable on residential properties and not on investment properties.

Here are some other general application requirements for the First Home Owner Grant:

  • Australian citizen or permanent resident
  • You are the minimum age set by your state or territory
  • A first home buyer as a person and not as a company or trust
  • You or your spouse/partner have never owned a property in Australia
  • You or your spouse/partner are first-time FHOG applicants
  • The property you purchase is planned for residential use
  • You will live in the residence for the minimum time directed by your state or territory
  • Your FHOG application must be made within 12 months of settlement

You can also visit for more details on their requirements.

If you need assistance with any owner-occupier home loans for first home buyers, contact a Chan & Naylor accountant near you, and we’ll be more than happy to help.

Aside from home loans for first home buyers, have a look at our other accounting and advisory services that we do to help you achieve greater success.

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Chan & Naylor Group has nationwide offices in North Sydney, South West Sydney, Sydney, Pymble and Parramatta in New South Wales, Melbourne, Moonee Ponds and Hawthorn in Victoria, Brisbane and Capalaba in Queensland, and East Perth in Western Australia that can assist you with your income tax as well as any property tax or business tax enquiry that you may have. Contact us today.



Photo: Stock Photo Secrets

One response to “First Home Owners on the Rise Due to State and Territory Incentives”

  1. Adam Ting says:

    There is the least increment in the house sale in Queensland rather than other states but I hope to good rise sale this year. Thanks for the information!

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