Everything you need to know about the $25,000 HomeBuilder Program

How To Take Advantage Of Government Grants and Schemes when Building Your New Home in NSW

How Is the HomeBuilder Grant Different from Other Grants?

The HomeBuilder Grant is a single-payment grant of $25,000.00. All individuals and couples who are eligible for the HomeBuilder grant can apply. One of the biggest differences between this grant and others is that the funds can be used for renovations and reconstruction of existing homes. Another is that there there is no rule that you must be a first-time homebuyer to be eligible for the grant. Any homeowner or home occupier who meets the criteria for the grant will be eligible to receive the funds.

As with all grants, there are several criteria that you must meet to be eligible to receive the funds. They are as follows:

  • You Must be an Australian Citizen
  • You must be 18 years of age or older
  • You must be either an individual or a couple. (The grant is not available to companies or trusts.)
  • As an individual, you must have an income of less than $125,000.00
  • As a couple, your income must be less than $200,000.00
  • Your income will be based on your 2018/19 tax return or any later tax return

Meet the criteria

The home you intend to build must also meet certain criteria for you to be eligible to receive the grant. Those eligibility requirements are as follows:

When Building a New Home

  • A new home may not exceed $750,000.00 in total value, including the land you purchased where the home will be built.
  • A licensed Australian building company must be used for the construction.
  • The construction start-date must be within 3 months of the date that you contract the work
  • The funds are not to be used for investment properties, whether new or renovated.

When Knocking Down and/or Rebuilding a Home

  • If you plan to knock down and rebuild your existing home, its value must not be more than $1.5 million. That includes the land where the home sits and must be the pre-renovation value.
  • The amount of money that you spend on the rebuilding of your home must be a minimum of $150,000.00 and a maximum of $750,000.00
  • All funds must be used for renovations or rebuilding directly connected to the existing home. For example, renovating or rebuilding the kitchen, bedroom, or bathrooms.
  •  be used for additional items not connected to the home, including swimming pools, a garage, an outdoor shed, or a tennis court. Only the home itself.
  • A licensed Australian building company must be used for the construction.
  • The construction start-date must be within 3 months of the date that you contract the work
  • The funds are not to be used for investment properties, whether new or renovated.

As of right now, the process for applying hasn’t been finalized by the Australian government. When it is, your application will need to be submitted through the NSW state government. We recommend that you bookmark our website and check back regularly for updated details over the next few weeks.

What Period Does the Grant Program Cover?

The grant covers any construction projects that begin from the 4th of June, 2020, until the 31st of December, 2020. Specifically, the contract for beginning construction must fall within those dates.

Can the HomeBuilder Program Be Used Alongside Other Grants and Schemes?

Yes. You can apply for the First Home Owners Grant and the Federal Government’s First Home Loan Deposit Scheme at the same time and be eligible for all three. One thing to keep in mind is that, for each grant, the eligibility requirements are different. You would need to qualify for all of them to use them together. You can also qualify for one but be disqualified for another based on your specific needs and situation.

Another excellent Grant that is being offered in NSW (and all of Australia) is the First Home Owner’s Grant. This grants, as its name suggests, is for any individual or couple who have never purchased and/or owned a home previously, making them ‘first-time homeowners’. If you are eligible for this grant you can receive $10,000 that you can then use towards the cost of building a new home. As with all grants, there are several eligibility requirements that you must meet, including:

  • If the home is already built, it must never have been owned or lived in by anyone previously.
  • The home can be already built and purchased from a developer
  • The home is also allowed to be built on your land using an independent contractor
  •  need extensive modification or reconstruction are not qualified

There are certain circumstances where the First Home Owner’s Grant can be approved for an individual or a couple who will use it to purchase an existing property. In most cases, this will need to be an older property that has been either brought back into use through reconstruction or has been extensively modified.

It is also possible to use the grant to purchase a property that will be taken from commercial to residential status (i.e. converting a storage facility into a home or converting a large warehouse into apartments). A derelict property that is reconstructed or refurbished may also qualify for the First Home Owner’s Grant in some cases. One thing to keep in mind is that every application is judged individually to ensure that all qualifications and requirements are met.

How Much is the First Home Owner's Grant in NSW?

Just like any other grant you apply for here in NSW, there are certain requirements that you must meet to be eligible for this grant. They include:

  • You must be over 18 years of age
  • You must be a resident of Australia (although there are exceptions)
  • The grant must only be used for purchasing your first property. If you are filing a joint application, both applicants must never have owned a home previously
  • If you are purchasing a home that is already built, the purchase price must be $600,000 or less
  • If you are having a new home built on your property, the value of both the home and property together must be $750,000 or less
  • The grants can only be used to purchase a home. It is not eligible for a factory, investment home, office or a home that will be leased out
  • Only newly built properties that have not been previously lived in or owned will qualify for use of this grant
  • You may commission your new home to be built on an individual basis or you may purchase it from a home developer
  • Once you have completed purchasing your new home, you must move into it within 12 months
  • Once your home is completed you will need to live in it for at least 12 months

Can the First Home Owner's Grant Be Used to Purchase Land?

No. The $10,000 that you receive from this grant can only be used to purchase a new home or, in some cases, a home that has been refurbished or rebuilt. You may not use the grant money to purchase land. However, if you purchase land as a first-time buyer with the intention of building a home on it, you will not incur a stamp duty if the land is less than $350,000. Furthermore, if the land you purchase is between $350,000 and $450,000 you will be eligible for a rebate of a certain percentage of the stamp duty.

Can the Grant Be Used as a Deposit for a New Home?

Yes, it is possible to use the grant to pay for your new home deposit. What you need to keep in mind, however, is that many mortgage providers will need cash up front to complete the transaction. The problem here is that the First Home Owner’s Grant is only paid after the home transaction has been completed. We suggest that you talk with your mortgage provider and find out what their policy is. You might also want to mention to them that you are applying for this grant and would like to use it as your deposit.

When Should You Apply for the Grant?

When you consider that grant levels have been reduced in other states in Australia over the last few years, you must apply for this grant as soon as possible. That way, you can get accepted for this grant before any possible changes occur. Furthermore, we would suggest that you apply as soon as you have decided to either build a new home or purchase a new home from a developer.

Unlike the Grants that we have talked about today, the First Home Loan Deposit Scheme doesn’t give you money but instead aims to help you save money on lenders mortgage insurance (LMI) fees.

This scheme is for first-time homebuyers who have only 5% to deposit on their mortgage. The problem that you face is most lenders require a deposit of 20%. Worse still is that, when you can’t pay the 20%, they force you to purchase the aforementioned LMI, which can cost thousands of dollars depending on the purchase price of your new home.

With the First Home Loan Deposit Scheme, the Australian government acts as the guarantor of your loan. Not only does this make it much easier for you to qualify for a new home loan but, as we mentioned, it will save you thousands on LMI fees. Do keep in mind, however, that the normal financial institution checks on your financial situation will still be in place. If you don’t qualify for a loan you won’t be able to use the scheme.


One very important note that you must be aware of is that in 2020 only 27,000 applications will be approved for this scheme. Also, applications are approved on a first-come, first-serve basis, which means that you should apply as early as possible. That way your chance of being approved, and be included in the 27,000 accepted applicants, will be much greater.

What Do I Need to Be Eligible for the First Home Loan Deposit Scheme?

As with any grant or scheme, there are several conditions that you must meet to be eligible for the First Home Loan Deposit Scheme. They include:

  • You must have 5% of the value of the property that you will purchase saved and be available to use for your deposit
  • If you are purchasing a home as an individual, the maximum that you can earn per year is $125,000.00
  • If you are purchasing your new home as a couple, your combined earnings can not exceed $200,000.00
  • High-value properties are not eligible. Only properties classified as “entry property” are eligible to be purchased under this scheme
  • In NSW, the capital city, Newcastle, Lake Macquarie and Illawarra have price caps of $700,000.00 for the new home your purchase.
  • In all other parts of NSW, the price cap is $450,000.00
  • To apply for this scheme you must go through your lender. Applications are not accepted directly from homebuyers

How Much Money Can Be Saved with this Scheme?

The exact amount of money that you can save when using this scheme depends on several different factors. Those include the amount of your loan, the amount of your deposit, and the terms and conditions set by your individual lender. The Australian government estimates that the average homeowner would save approximately $10,000.00 with this scheme as they would not need to purchase lenders mortgage insurance (LMI).

Does the House or Apartment Being Purchased Need to be New?

No, they do not. That is one of the biggest benefits of this scheme as you can use it to purchase an existing house, a townhouse, or an apartment as well as a house/land package. You can also use this scheme to build an off-the-plan apartment or townhouse with a contractor.

Can This Scheme Be Used with Any Grants?

Yes, it can. You can apply for this scheme as well as the First Home Owner’s Grant and any other schemes offered in NSW. One thing to remember is that all of the different grants and schemes have different eligibility requirements. It’s possible you may be eligible for one and not eligible for another.

What is the First Home Buyer Assistance Scheme?

In Australia, new home buyers must usually pay a Transfer Duty (formerly known as a stamp duty). The First Home Buyer Assistance Scheme, however, allows you to either get a lower rate on the transfer duty or to be completely exempt from paying it. This scheme is intended for homeowners who are buying an existing home, buying a new home, or purchasing land where they intend to build a new home.

What Do I Need to Be Eligible for the First Home Buyer Assistance Scheme?

There are several Qualifications that you will need to be eligible for this scheme. They are slightly different depending on if you will purchase a new or existing home or you will purchase a plot of vacant land.

New Or Existing Home

  • For a home that is valued under $650,000, a full exemption on the total transfer duty is possible
  • For a home that is valued between $650,000 and $800,000 you will be eligible to apply for a lower rate (concessional rate) of transfer duty that will be based on the exact value of your home

Vacant Plot of Land

  • When you purchase a plot of land that is valued under $350,000 you can apply to have a full exemption of the total transfer duty
  • For a plot of land that is valued between $350,000 and $450,000 you will be eligible to apply for a lower rate (concessional rate) of transfer duty that will be based on the exact value of the land

The following qualifications must also be met:

  • The individual or couple purchasing must be 18 years of age or older
  • The scheme is only available for individuals or couples, not a company or trust
  • As an individual or a couple, neither of you can have owned, or co-owned, any type of residential property in any Australian location
  • The contract date for your home and/or property must be on or after the 1st of July, 2017. It must also be for the entire property
  • Neither you nor your spouse (if purchasing as a couple) may have received this scheme previously or any exemptions or concessions of this scheme
  • If purchasing as a couple, one of you must be an Australian citizen or permanent resident of Australia
  • Within 12 months after purchasing the property you must move into your new home
  • Once you move in, you must live in your new home for at least six months continuously
  • As a member of the Australian Defence Force, the above living requirements will be waived

In Closing

At this point, we hope that you realize just how many excellent Grants and Schemes are available to you as a new home buyer, first-time homebuyer, or a homeowner rebuilding after the devastating bushfires. Whether you’re building a new home, rebuilding, installing a Granny Flat, or performing major renovations, the grants and schemes above can save you tens of thousands of dollars.

Here at Grouse House Homes, we are proud to help you take advantage of all of them and even more proud to offer some of the finest new homes in NSW. If you have any questions, need advice, or would like help filling out applications for any or all of these grants and schemes, please feel free to contact us at any time.

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