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Housing Construction Grant

Discussion in 'Property Finance' started by Liam Blanden, 15th Oct, 2015.

  1. Liam Blanden

    Liam Blanden Well-Known Member

    Joined:
    19th Sep, 2015
    Posts:
    68
    Location:
    Adelaide
    Anyone know if the housing construction grant can be used as part of a deposit like the FHOG to lower your LVR?

    Im in Adelaide and am looking to possibly buy a block and build. The more money i can scrape together the better off i am.

    Cheers
     
  2. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,173
    Location:
    Adelaide, SA
    Yes it does - currently you'd be eligible for 15k.
     
  3. tobe

    tobe Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    897
    Location:
    Melbourne
    There are 3 kinds of deposit.

    1 is the holding deposit. It can be as little as $100, it's what you pay the estate agent or builder so they can't sell the property to anyone else.

    2 genuine savings. For people without a home loan, banks need a record of their financial history. It's best thought of as a test, rather than specifically a cash 'deposit', as it doesn't necessarily need to be outlaid as part of the transaction. The test generally means 5% of the purchase price saved over at least 3 months. It could also be shares etc. Some lenders will accept a rental history instead. Some lenders only require 2.5% instead of 5%

    3 funds to complete. Banks need to see that you have the difference between what they lend you and the purchase price plus costs.

    The fhog can only be used for the last kind of deposit and only then with lenders that 'use' the fhog before the government actually pays it when the builder lays the slab.

    So if you get the right broker and lender, you can get away with quite a small actual outlay for your first home using the grant.
     
  4. Liam Blanden

    Liam Blanden Well-Known Member

    Joined:
    19th Sep, 2015
    Posts:
    68
    Location:
    Adelaide
    Thanks for the informative post @tobe :)

    Corey I heard in the grape vine you had a similar experience as your first place?