Is The Help To Buy Scheme Available For Australian Expats?
If you’re an Australian expat living overseas and interested in purchasing property in Australia, the Help To Buy (HTP) Scheme is a new, helpful government home loan scheme that’s likely under your radar. It offers an excellent opportunity for Australians to make their homeownership dreams a reality.
This article explores the Help To Buy scheme, its benefits, eligibility criteria, and what to do if you don’t qualify. By the end, you’ll have a clear understanding of the Help To Buy Scheme and whether or not it can help you secure your ideal home.
Let’s begin with what it means for Australians looking to buy property.
What Is the Help To Buy Scheme?
The Help To Buy scheme in Australia is a program that enables individuals to purchase a home by sharing equity. Under this scheme, the government contributes up to 40% of the total cost for a new house and up to 30% for an existing house.
By participating in the help-to-buy scheme, you only need to provide a 2% deposit and are not required to pay Lenders Mortgage Insurance. Additionally, you are not responsible for paying rent on the portion of the property owned by the government. Furthermore, you have the option to buy out the government’s share in the future.
The amount of savings you can achieve on a property through the scheme will vary depending on the property price. With different price caps set for various locations, a government equity contribution of 40% can save you between $120,000 and $380,000 if you are purchasing a new house. On the other hand, if you buy an established home, a government equity contribution of 30% can save you between $120,000 and $285,000.
The Australian Labour Party introduced the help-to-buy scheme as a response to the ongoing housing affordability crisis. This will commence in July 2023. Each year, there will be 10,000 available spots for eligible Australians to participate in this program.
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Help To Buy Scheme Eligibility Criteria
To be eligible for the HTB scheme, you must:
- Be an Australian citizen of 18 years of age or older (permanent residents are not eligible)
- Be purchasing a residential property which is going to be your primary residence
- Be purchasing a new or existing stand-alone house, semi-detached house, duplex, townhouse, or unit
- Have a taxable yearly income of no more than $90,000 for individuals or no more than $120,000 for couples
- Reimburse the government’s financial contribution partially or entirely, based on your individual circumstances, if you surpass the maximum income limit for two consecutive years
- Not own land or property in Australia or overseas
- Have saved the required minimum 2% deposit of the home price
- Pass the serviceability test for the remainder of the purchase through a home loan with a participating lender
- Be able to pay for all associated upfront and hidden costs, such as stamp duty, legal fees and bank fees
Do Australian Expats Qualify for the Help To Buy Scheme?
Unfortunately, no. Australian expats overseas are not eligible for the Help To Buy scheme to purchase a property in Australia. This is because one of the eligibility criteria entails that you must buy a residential property which will be your primary residence.
If you are an Australian expat overseas and are interested in buying a property in Australia, you may still be able to get a home loan. However, you will need to meet the eligibility criteria of the lender you are applying to. Some lenders may be more willing to lend to expats than others.
What Other Options Are Available?
If you are an Australian expat overseas and you are interested in buying a property in Australia, it is best to do your research and speak to a mortgage broker who can help you understand your options.
Although the Help To Buy scheme is unavailable for you, other government schemes are available, and several private lenders offer expats home loans.
Here are some alternative programs and options for you to consider:
- If you are a first-time homebuyer, additional schemes and government grants are available, such as the First Home Super Saver Scheme.
- You have the option to apply for a guarantor home loan, where you may be able to borrow up to 105% of the property value.
- There are also home loan options available with no or low deposit requirements.
Find the Right Option for You
Although the Home To Buy Scheme is unavailable, you can still qualify for a home loan through other avenues, such as those discussed above.
Odin Mortgage specialises in assisting Australian expats living abroad in obtaining home loans to buy property in Australia. Our team is highly knowledgeable and well-equipped to support you no matter your situation.
Get in touch with us to delve into your requirements and discuss them in depth.
Get a free Australian mortgage assessment today.
Frequently asked questions
The Help To Buy Scheme is an initiative by the Australian government to make homeownership more accessible for Australian first home buyers. It provides shared equity and financial assistance to eligible individuals, enabling them to purchase a property in Australia.
Australian citizens of at least 18 years of age buying their first and primary home of residence are eligible to participate in the Help To Buy Scheme. There are also other specific residency requirements, income limitations, and property value criteria you need to meet.
The application process for the Help To Buy Scheme involves several steps. Below are the steps in brief:
- Begin by conducting thorough research and gathering the necessary documents.
- Seek professional advice from a mortgage broker specialising in the scheme.
- Get pre-approved for a mortgage, select a property within the scheme’s guidelines, and submit your application along with the required documentation to the relevant authority.
- Once your application is approved, proceed with the property purchase and settlement process.
The Help To Buy Scheme offers several benefits, including shared equity, financial assistance, and the opportunity to enter the Australian property market. It helps make homeownership more affordable, especially for first home buyers, by reducing the upfront costs and providing access to favourable financing options.
Yes, you can combine the Help To Buy Scheme with other government support programs and incentives available to first home buyers. These programs can complement the benefits provided by the Help To Buy Scheme and further enhance your ability to purchase a property in Australia.
While the Help To Buy Scheme is a government initiative, its availability and specific details may vary across different states and territories in Australia. It’s recommended to check with local authorities or consult a mortgage broker with expertise in the scheme to understand the specific guidelines and options in your desired location.
The Help To Buy Scheme primarily targets first home buyers. Therefore, you will not be eligible for the scheme if you already own a property. Consult with a mortgage broker or financial advisor to explore other options that may be available to you.