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14 January 2021
Master Builders has had a win with the government extending the eligibility under the First Home Owners’ Grant.
The same change also applies to the Regional Home Building Boost Grant which can be accessed until 31 March 2021.
Both grants are only available for first home buyers purchasing a new home.
The government defines a new home as either:
- A house, apartment, unit or townhouse that has never been:
- Occupied as a place of residence
- Sold as a place of residence
- A substantially renovated home.
The stipulation “never been sold as a place of residence” has been catching people out.
Builders often secure access to a vacant block of land from a developer on 'builder’s terms'. In these cases ownership of the land may transfer to the builder after construction is complete.
Because the land transfers into the builder’s name with a house on the land, the new house is deemed to have 'been sold as a place of residence'. This is despite the transaction actually only being for the land.
This has been leaving the next transaction to the home owner ineligible for the grant, as the house has previously been 'sold as a place of residence'.
The government has now extended the definition of 'new home' to those built under 'builders terms'.
This means that homes built under ‘builders terms’ on land that transfers to the owner builder before being sold to the home owner will still be eligible for the Grant provided all the other criteria are met.
The change will not assist in cases where a builder transfers a house from one related legal entity to another before selling onto the first home buyer. These transactions will continue to render the homeowner ineligible for the grant as the house has been 'sold as a place of residence'.
Any questions? Call Master Builders on 1300 30 50 10.