First home buyers in 2020

First home buyers in 2020

Looking to buy your own home in 2020? Thanks to the Federal Government, your goal is that much closer! First home buyers in 2020 will only need to front 5%of the mortgage to their dream home, while the FederalGovernment will guarantee up to a further 15%. This gives new home buyers a little breathing room and flexibility when it comes to their first home purchase.

Further to that, new home buyers will not need to pay mortgage insurance, which is usually required on lower deposit home loans. On the flipside, it’s important to be aware that a smaller deposit means a higher principle to pay off in the long run.

Who will the government guarantee be available to?

vIf you are a couple looking to buy your first home with this leg up, your combined taxable income can be no more than $200 000. It’s also worth noting that the above is applicable to principle and interest loans only.

“The scheme is designed to facilitate earlier access to home ownership for first home buyers, by providing a guarantee that will allow eligible first home buyers on low and middle incomes to purchase a home with a deposit of as little as 5%,” the Government said.

Is there a limit to the mortgage you can attain?

The Commonwealth government has allocated $500 million in the form of equity to the National Housing Finance and Investment Corporation (NHFIC). To help curb demand for this new scheme, the Government has set a limit on your new home purchase. This limit varies depending on your state and its current property market. The following limits apply per state:

These thresholds are listed below:

State/territory Capital city and large regional centres
NSW $700,000
VIC $600,000
QLD $475,000
WA $400,000
SA $400,000
TAS $400,000
ACT $500,000
NT $375,000