From time to time the government seeks to stimulate the economy by offering grants and exemptions to entice us to dip our toes into the property market. First Home buyers have been the traditional beneficiaries of these grants, with the original First Home Owner Grant being introduced in July 2000 in an attempt to negate the effect on the property market of the newly introduced GST. Since that time there have been numerous schemes with similar names helping first home buyers realise the Australian dream of property ownership.
Eligible first home buyers can currently apply for two schemes – one that provides a grant of $10,000, and the other an exemption or concession from stamp duty.
First Home Owner Grant (New Homes Scheme)
– Grant of $10,000
– For purchasing a brand new (never lived in & being sold for the first time) home under $600,000
– For building a new home where the total price of land and building is under $750,000
Individuals over 18 that have not owned or co-owned property in Australia may apply for this grant. At least one of the purchasers must be an Australian Citizen or permanent resident. If you have purchased a residential property since 1 July 2000 and lived in it for less than 6 months you may also be eligible for the grant.
One of the purchasers must move into the home within 12 months and continue to live there for at least 6 months. If you are building a new home you must move in within 12 months after the house has been constructed.
First Home Buyer Assistance Scheme
This scheme provides an exemption or concession on the amount of stamp duty payable when a first home buyer purchases an existing home, new home or vacant land on which they will build a home. Thresholds apply which have changed over time, most recently in August 2020.
New Homes – Full stamp duty exemption for new homes under $800,000. If the property is over this amount you will pay a concessional rate of duty between $800,000 and $1 million.
Existing Homes – Full stamp duty exemption for existing homes under $650,000. If the property is over this amount a concessional rate of duty is payable between $650,000 and $800,000.
Vacant land – Full stamp duty exemption for land under $400,000. If the land is over this amount a concessional rate of duty is payable between $400,000 and $500,000.
This scheme is for individuals over 18 who have not owned residential property in Australia. At least one of the first home buyers must be an Australian citizen or permanent resident. You must live in the property for at least 6 months within 12 months of buying the property.
Still confused about whether you are eligible for these grants? Contact the Property Law Team at Everingham Solomons because Helping You is Our Business.
Part of the government’s response to the economic downturn caused by Covid-19 has been to encourage spending in certain sectors. The building industry have been given a lifeline via the Homebuilder scheme, which encourages eligible home owners to renovate their existing home, buy a new home off the plan or build a new home.
The scheme was to finish at the end of 2020, but has now been extended to 31 March 2021 with an amended grant amount and conditions.
The grant you will receive depends on when you entered into your building Contract and applications must be submitted by 14 April 2021. First Home Buyers are also eligible for this grant. Construction must begin within 6 months from the date of the building Contract and you will need to live in the property for at least 6 months after completion.
$25,000 Grant – For building contracts entered into between 04/06/20 and 31/12/20. The value of the house and land must be under $750,000 if you are building. For renovations your contract must be between $150,000 and $750,000 and the value of the existing house and land must be under $1.5 million.
$15,000 Grant – For building contracts entered into between 01/01/21 and 31/03/21. The value of the house and land must be under $950,000 if you are building. For renovations your building contract needs to be between $150,000 and $750,000 and the value of the existing house and land must be under $1.5 million.
To get the grant you must be an Australian citizen, over 18 and earn less than $125,000 p/a as an individual and $200,000 p/a as a couple. Permanent residents and visa holders are not eligible.
For new builds, the Grant will be paid once the foundations are laid and the first progress payment has been made. For renovations, it will be paid once payments over $150,000 have been made to the builder.
Still confused about whether you are eligible for these grants? Contact the Property Law Team at Everingham Solomons because Helping You is Our Business.
There are strict rules that apply when a Landlord wants to bring a residential tenancy to an end.
A termination notice must be provided to the tenant. This notice must be in writing, addressed to the tenant, signed and dated by you or your managing agent, provide the date the tenancy is to be terminated and the tenant needs to vacate and in some circumstances provide the reason for the notice.
In some circumstances there is no minimum notice period for the tenant – for example if the tenant dies, the property becomes uninhabitable or is destroyed, is being compulsorily acquired (for example by Council) or is not legally usable as a residence.
In most circumstances minimum notice periods apply to terminate a tenancy, depending on the situation:
If the fixed term has expired and the tenant has continued on – 90 days
If the property has been sold as vacant possession, and the fixed term has expired – 30 days
If the fixed term is coming to an end – 30 days
If the tenant has breached the tenancy agreement or is more than 14 days in rent arrears – 14 days
It is important to note that once a tenant has been given notice they can move out at any time without giving you notice. The tenant will only need to pay rent until they vacate the property, unless they are still under a fixed term agreement whereby they will need to pay rent until the end of the fixed term.
A second notice on different grounds may be given to a tenant if necessary, for example if the tenant has been given notice to end the fixed term but then doesn’t continue to pay rent.
Different rules apply for Commercial, Industrial and Retail leases.
Confused about your rights as a Landlord? Contact the team at Everingham Solomons because Helping You is Our Business.
To bring a tenancy to an end you must provide written notice to the landlord or managing agent, in a specific timeframe depending on your situation. When your fixed term is ending – if you want to leave at the end of your fixed term lease you need to give the landlord at least 14 days’ notice. You can provide this notice at any time up to the very last day of your fixed term. If your fixed term has already ended – if you have continued to rent the premises, say on a week to week or month to month basis, you need to give the landlord at least 21 days’ notice. When the Landlord has decided to sell the property – if you are still in your fixed term you can end your tenancy by giving the landlord at least 14 days’ notice. This however doesn’t apply if your landlord advised you of their intention to sell the property before you entered into the tenancy agreement. When the landlord gives you notice – if you have been given a notice of termination, you are entitled to move out before the notice ends. If you are at the end of a fixed term agreement you must pay rent until the Lease term ends, otherwise you only need to pay rent up until you vacate the property.
Under no circumstances should you ever stop paying rent, even if there is a dispute with the landlord. This is a breach of the lease agreement. Victims of domestic violence – new legislation introduced in February this year has created a provision that applies if you are in a domestic violence situation. In these circumstances there is no minimum notice period, however you must provide specific evidence to the Landlord as well as a domestic violence termination notice to both the Landlord and any of your co-tenants. The evidence that may be used in this situation is a declaration from a Medical Practitioner, a Domestic Violence Order, Family Law injunction or a Conviction Certificate.
Different rules apply for Commercial, Industrial and Retail leases.
Confused about your rights as a tenant? Contact the team at Everingham Solomons, because Helping You is Our Business.
In every Contract there is a set time for Completion, or ‘Settlement’ as it is often called. The time for Completion can be a set number of days or weeks after exchange takes place (eg 42 days or 6 weeks), or a set time after another event takes place (eg 14 days after a plan or subdivision has been registered).
Completion or Settlement is essentially when the Purchaser hands over their money and takes title to the property.
It is crucial that a purchaser in a property transaction is aware of the date that Completion is due under the Contract, as there are serious consequences when Completion doesn’t take place on time.
Most Contracts contain a condition that the Purchaser of a property may be charged penalty interest by the Vendor if Completion does not take place on the due date. The interest rate usually varies between 8 and 10 percent and is payable on the outstanding purchase price due at completion (that is, the purchase price less any deposit paid). Depending on the price of the property, the daily interest amount can be hundreds of dollars per day, for every day you are late settling your purchase.
Most Contracts also contain a condition whereby the Vendor’s representative can issue a Notice to Complete, which gives the Purchaser a further term (usually 14 days) to complete the Contract. This notice makes the completion time an “essential” term of the Contract. If completion does not take place at the end of the further term, the Contract can be cancelled and the Vendor may keep the deposit paid, usually equal to 10% of the purchase price.
On top of this the Vendor may also take action against the Purchaser for their costs on the resale of the property (eg agents fees) and also seek compensation if the property is sold for a lower sale price.
Purchasing a property is a rewarding but sometimes stressful exercise and it’s important to know your obligations under a Contract. The team at Everingham Solomons have the expertise to assist you, because Helping You is Our Business.
You’ve found a house you love, put in an offer and it’s been accepted! Time to break out the champagne? Not just yet….
One of the most important things to remember when buying a property is that the Contract is not binding on either the purchaser or seller until Contracts are exchanged. That is the contract, evidencing all of the important terms have been signed by both the vendor and purchaser and the contracts have physically been exchanged.
Agents are legally bound to pass on to owners all offers made up to exchange. This means that although your offer has been accepted, another buyer may also make an offer on the property. One of the following may then happen:-
The Vendor may decide to continue with the sale to you
If the second buyer’s offer is the same as yours you may end up in a ‘Contract race’ – essentially the first buyer to submit a signed Contract to the owners Solicitor/Conveyancer for exchange will be the successful buyer. In this scenario the most ‘organised’ buyer (with finance already approved etc) has an advantage.
If the second buyer’s offer is higher than yours you may be encouraged by the agent to increase your offer, or the owner might simply decide to sell to the buyer with the highest offer – this is gazumping, and unfortunately it is completely legal.
Contract races and gazumping are extremely stressful for buyers – after all, you really want this property!
So, how can you avoid ending up in a Contract race, or being gazumped?
The best advice is to be organised, so when you find your dream property you are ready to go.
Finance approval – go to see your bank or broker early and get pre approval. This will allow you to know your budget and give you confidence when making an offer.
Deposit – generally a cash deposit of 10% is required, although a reduced deposit or a deposit bond may be accepted by the owner of a property. Know how you are going to pay the deposit, and when you make your offer be ready to pay it straight away. The deposit can be paid any time up to exchange, but it is a great ‘sign of good faith’ to a Vendor when you pay it nice and early. You will get your deposit back if you don’t proceed to exchange.
Get Advice – before you make an offer get a copy of the Contract from the agent and have your Solicitor/Conveyancer have a look at it. This will alert you to any issues early on.
Inspections – decide what inspections you want to do on the property (eg Pest and Building Reports) and arrange these as soon as possible once your offer has been accepted.
Buying a property is an exciting, but often stressful time. Our Property Law Team is ready to assist you because Helping You is Our Business.
Settlement, or the Completion Date under a Contract, is essentially the day a Purchaser hands over the money to buy a property and in return is provided with the title documents and the keys.
In New South Wales settlement takes place in one of two ways:
In person via a paper settlement – this is still the most common way for settlements to proceed. It involves the legal representatives for each party (the buyer and the seller) as well as their banks meeting in person at a scheduled time. At this meeting the title documents and bank cheques are exchanged between the parties. The Certificate of Title, Transfer and any Discharges of Mortgage or new Mortgages are then sent to the Land Registry for registration.
PEXA/Online settlement – the online settlement portal allows for a settlement to take place electronically without the need for the parties to physically meet. Funds are transferred electronically and the title to the property is transferred into the new owners names immediately on settlement.
What do you need to do to prepare?
Usually the settlement date is a set number of days after the exchange of Contracts, usually 42 days (6 weeks), so hopefully you have had plenty of time to prepare.
For a Vendor (owner) – you need to vacate the property prior to the settlement date. The property should be left in a neat and tidy condition inside and out. You should also contact your service providers (electricity, gas etc) and let them know you are moving. Your insurance for the property needs to stay in place until after settlement.
For a Purchaser (buyer) – you will need to do a final inspection of the property prior to settlement. This is essentially your ‘last look’ at the property before handing over the purchase money. The property should be neat and tidy and in the same condition it was when you made your offer. The final inspection is arranged through the selling agent who will meet you at the property.
Insurance – the Purchaser needs to take out an insurance policy for the replacement value of the property that is effective from the time that settlement takes place. If you are obtaining finance to assist with the purchase your bank will probably specify a figure that they want the property insured for. They will also require the bank’s name to be noted on the policy as mortgagee.
Prior to settlement the Purchaser should contact their preferred service providers and arrange the connection of utilities on the settlement date.
What can go wrong?
Unfortunately there are times when settlement doesn’t take place on the due date. This can be for many reasons, sometimes it is simply a matter of a document not arriving on time. Rest assured your Solicitor or Conveyancer will do everything they can to avoid delays to settlement, we know you are keen to move on or move in!
When can I have the keys?
As soon as settlement takes place your Solicitor or Conveyancer will let you know. You can then collect the keys from the selling agent and move in.
Are you looking to buy or sell a property? Speak with our Property Law team today at Everingham Solomons because we have the expertise & experience to assist you in your property transactions because Helping You is Our Business.
Two schemes currently exist for First Home Buyers. One is a grant of $10,000 and the other is a Stamp Duty Exemption.
First Home Buyers Assistance Scheme – (Stamp Duty exemption)
For both new and existing homes – you will not pay stamp duty up to a purchase price of $650,000, and you will get a concession from stamp duty if your purchase price is between $650,000 and $800,000.
The usual stamp duty on $650,000 is $24,760 – a huge saving!
Vacant land – you will not pay stamp duty up to a purchase price of $350,000, and you will get a concession from stamp duty if the purchase price is between $350,000 and $450,000.
The usual stamp duty on $350,000 is $11,260.
First Home Owner Grant (New Homes) Scheme – (Grant)
A grant of $10,000 is available for the purchase of new homes with a purchase price up to $600,000. For Contracts to build or owner builders the price can be up to $750,000. A new home is a home that has not been previously occupied.
Am I eligible?
You must satisfy the following requirements in order to receive the Grant or Exemption:
The purchase must be for the whole property
All purchasers must be ‘eligible purchasers’ – a person (not a company), over 18 who has not (and whose spouse/de facto has not) previously owned residential property or received an exemption or concession under the old First Home—New Home Scheme.
At least 1 eligible purchaser must occupy the home as their principal place of residence for a continuous period of 6 months, within the first 12 months after completion. The residence rule however may not apply for those in the armed forces
Note: If not all purchasers are first home buyers you may still qualify for a concession under the shared equity arrangements. Provided that the eligible first home buyer buys at least 50% of the property then you can get a pro-rata concession.
Thinking of buying your first home? Contact the Property Team at Everingham Solomons because Helping You is Our Business.
Buying a house is an exciting time however if you have not purchased a home before, or haven’t for a while, it is hard to know where to start, or how it all works! This short guide will help you through – from making your offer to buy, to a legally binding Contract.
Finance – one of the first things you should do is talk to your bank or finance broker. They will tell you how much you can borrow, the deposit you will need and what your repayments will be.
Research – get to know the property market. Look at properties sold in your area and attend open houses. Get to know real estate agents and let them know what you are looking for.
Offer – once you find your perfect place, make an offer! It is important to note at this stage you are not bound to buy the property and the seller is not bound to sell it to you, even though they have accepted your verbal offer. Both parties can change their mind, and should a higher offer be made the seller can certainly take it.
Advice – now that your offer has been accepted it is time to get some advice. Find a property Solicitor or Conveyancer to guide you through the process.
Inspections – these may include Pest and Building inspections, Survey report and inspection of Council’s records. It is ‘buyer beware’ – so make sure you know as much as possible about the property you are buying before you commit to the purchase.
Deposit – usually 10% of the purchase price. This can be paid any time after your offer is accepted. The deposit is usually held by the selling real estate agent. You will get your deposit back if you don’t proceed to exchange.
Contract – the Contract will be sent to your Solicitor/Conveyancer and you will then meet with them to go through the Contract.
Exchange – Once you have signed the Contract, are happy with your inspections and have formal approval of finance you are ready to exchange. Exchange is when both parties are officially ‘locked in’ to the purchase. Once you exchange you will also then know the settlement date – the day you get your keys!
Buying or Selling? Contact the Property Team at Everingham Solomons because Helping You is Our Business.
From time to time the government seeks to stimulate the economy by offering grants and exemptions to entice us to dip our toes into the property market. First Home buyers have been the traditional beneficiaries of these grants, with the original First Home Owner Grant being introduced in July 2000 in an attempt to negate the effect on the property market of the newly introduced GST. Since that time there have been numerous schemes with similar names helping first home buyers realise the Australian dream of property ownership.