FHBG shack

dont know the answer to this.
Friend wants to buy a country shack.
Circa 80k.
No power or connected utilities.
How would they prove PPR in order to claim FHBG?

 

Probably couldn't as the "shack" would need to be classified as a livable dwelling. Min standards are functional kitchen with running water and a bathroom with same.

May be able to get around it using a lender that takes contract of sale as a valuation but probably doesn't fit the bill by the sounds of it pending location?

 

Just live in it.

Keep some evidence such as correspondence and take some photos.

 

You would have to get passed the valuation issue first and whether its acceptable to bank as a livable dwelling?

 

Assuming your friend is in Victoria, they'll sign a PPR stat dec and get a 50% stamp duty reduction. For an $80k property it will save them $835.

Waste of the grant if you ask me. You only get it once.

 

Would be $1284.70 in WA.

 

Only if borrowing!

As long as it has a dwelling it could be a main residence from an income tax pov

 

My understanding is that if you don't use it you loose it.. I have 2 properties and haven't used the fhog and I was told that I wasn't eligible anymore. Also told that my partner wouldn't be eligible due to me owning the properties.

 

Get your partner to apply as a single. If Serviceability permits of course.

 

This won't work as In Victoria:

'You are not entitled to the FHOG if you (or your spouse/partner) have previously:

• Received a first-home owner grant in Australia,
• Owned a home in Australia, either jointly or separately, prior to 1 July 2000,
• Occupied, for a continuous period of at least six months, a home in which either of you acquired a relevant interest on or after 1 July 2000 in Australia'

Source: Vic State Revenue Office website

 

We are defacto relationship so I was told that it would be considered fraud to not disclose the relationship. We are in WA

 

Depends on the circumstances. If you move into a property you own, you do loose it. In some states you can purchase an IP or six, never live in any of them and still be eligible for the grant.

Really bad idea. They do have ways of checking these things and that scenario is not legal.

 

Thanks Peter. My first property was a PPOR turned to IP but I couldn't use FHOG because it was bought as tenants in common but then refinanced and I bought the other party out.

 

Well that's no good then. I have a young workmate who has only been living with his partner for 3 months, (in her mothers house) while they save deposit/s. I had suggested they go buy one new 320k townhouse each and claim the 20k. They'd only have to "live apart" for 12 months then decide how to proceed then. That's out the window.

I don't see it as fair that some can go out and buy 6 IP's then turn around and claim the FHOG. That to me is a rort. I'm sure I'm not alone in this thought. But go figure.

 

At three months, it might not be considered defacto in the long term sense yet.

 

3 months doesn't make a defacto relationship and there's also concessions for the grant if you didn't benefit from the relationship. Living in a partner's mother's house certainly wouldn't eliminate you from a grant.

As an example. A couple built a house and applied for the grant. She'd previously been married for 6 months before they divorced. The ex-husband owned a house which she moved into whilst they were married.

When they separated she didn't get any payout and the house was never hers. It took a bit of extra work but that lady and her new husband did manage to get the FHOG when they built their new home.

 

You would need to check on this by looking at the relevant act and finding the definition of spouse. It may be a defacto relationship.

 

I believe legally Defacto becomes Law @ 6 months of cohabitation? @Terry_w may have the ruling on this.

At any rate, it looks as though my young friend AND his girlfriend may only be able to claim the FHOG once between them.

 

It all depends - there are multiple different definitions. You would have to look at the relevant legislation.

 

Thanks Terry.

Your ears must have been burning as you replied just before my last.