Who counts as a first home buyer in Queensland? Six tests compared

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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"First home buyer" sounds like a plain fact about a person: either you have owned a home before or you have not. In practice it is six different questions, asked by four different agencies, and a Queenslander can truthfully answer yes to some and no to others on the same day.

The differences are not small print. One scheme looks back ten years and no further. Another looks back for ever and across the whole world. One asks only about homes you lived in; another counts a vacant block of land. Two of them test your spouse's history as well as your own, even when your spouse is not buying. Someone who inherited a share of a unit, bought land years ago, owned a flat overseas or has a partner who once had a mortgage can be a first home buyer for one purpose and not for the next.

This guide sets out the previous-ownership test used by each form of help open to a Queensland first buyer: the First Home Owner Grant and the first home duty concessions, both run by the Queensland Revenue Office; the Australian Government's 5% Deposit Scheme and its Help to Buy scheme; Queensland Treasury's Boost to Buy; and the First Home Super Saver scheme run by the Australian Taxation Office. It then runs five common histories through all six.

Queensland Revenue Office, the Australian Government's First Home Buyers website, Queensland Treasury and the Australian Taxation Office.

Why there is no single definition

Each scheme was written at a different time, by a different government, to do a different job. The grant's test is anchored to 1 July 2000 and is built around a home the applicant lived in. The duty concessions are built on the idea of a residence. The federal guarantee counts only the past ten years, which lets people back in after a long gap in ownership. Shared equity is rationed by places and by income, and one version of it does not require a first home buyer at all.

None of the agencies relies on another's decision. The Revenue Office says on its own pages that the grant and the duty concessions have separate eligibility requirements, and the Australian Taxation Office says its scheme operates independently of state and territory concessions. An approval under one is not evidence for another.

Four things vary from test to test, and they are the things to look for in each section below:

• what kind of property counts: a home, any residence, land, or any property at all
• whether it matters that you lived in it
• where it was: Queensland, Australia or anywhere in the world
• whose history counts: yours alone, or your spouse's too.

The grant: a home you lived in, and your spouse's history

The First Home Owner Grant is $30,000 toward a new home valued under $750,000. Its ownership test is the oldest of the six and has a date in the middle of it.

The Revenue Office's eligibility page says that "you or your spouse must not have owned residential property in Australia" in either of two situations: on or after 1 July 2000, if you lived in it; or before 1 July 2000, whether you lived in it or not.

The two halves work differently. For anything owned since 1 July 2000, the question is occupation. A property held purely as an investment since that date does not rule a person out, and the Revenue Office says an applicant in that position may still qualify by providing evidence that they have not lived in the investment property. For anything owned before 1 July 2000, occupation is irrelevant: ownership alone is enough to fail.

Three further points complete the test.

It is limited to Australia. The wording is residential property in Australia. A home owned in another country is not within it.

It includes the spouse. The words "you or your spouse" mean a partner's history counts even when the partner is not an applicant. The Revenue Office defines a spouse as a person you are married to, a de facto partner of two years or more, or a registered partner under Queensland's Civil Partnerships Act 2011. Its application guide requires a spouse to be identified on the application whether or not they will own the home.

It includes earlier grants. Neither the applicant nor the spouse can have received a first home owner grant before, in any Australian state or territory.

The duty concessions: any residence, anywhere, ever

Queensland's first home transfer duty concessions use the strictest wording of the six. The Revenue Office requires that the buyer has never held an interest in a residence anywhere in the world. The same condition appears on the page for the first home vacant land concession, which is the concession for a block bought to build on.

Compare that with the grant, word by word.

"Anywhere in the world" removes the limit to Australia. A person who owned an apartment in Auckland or London before moving to Queensland is not excluded from the grant by that fact, but is excluded from the duty concession.

"An interest" is wider than ownership of the whole. A part share counts. So does a share that came by inheritance or was held with a former partner, for however short a time.

"A residence" is not limited to a home the buyer lived in. An investment unit is a residence. There is no investment exception here of the kind the grant allows, and there is no cut-off date.

One kind of property is on the other side of the line: land with no home on it. The test is about a residence, and the existence of a separate concession for first buyers of vacant land shows the logic. A person who has owned only an empty block has not, on the wording, held an interest in a residence.

The conditions on the Revenue Office's concession pages are framed around the buyer. They do not use the grant's "you or your spouse" formula. Where two people buy together and only one of them meets the conditions, how much of the concession is available depends on the transaction and is a question for the Revenue Office or the conveyancer lodging the duty, not something to assume from the summary.

The 5% Deposit Scheme: a ten-year clock

The Australian Government's 5% Deposit Scheme, which lets a first buyer borrow with a 5 per cent deposit and no lenders mortgage insurance, uses the most forgiving test. A first home buyer under the scheme is someone who has not owned a home or land in Australia in the past ten years.

The First Home Buyers website explains how the ten years are counted: "The 10-year period is measured from the date your previous property was sold, to the date you enter into a new loan agreement." A person who sold a home eleven years ago and has rented since is a first home buyer again for this scheme, and for no other in this guide.

Two details cut the other way. The test covers land as well as homes, so a vacant block owned within the past ten years disqualifies a buyer here although it would not under the duty concession. And the clock starts at the sale of the previous property, not at its purchase. Someone who bought in 2010 and sold in 2020 has been out of ownership for six years, not sixteen.

The test applies to each applicant. The scheme allows an application by one person or by two people jointly, and a joint application needs both to pass.

Single parents and single legal guardians have their own stream. The website says they need not be first home buyers. What is asked of them is about the present: they must not own another property once the purchase settles.

Shared equity: two opposite tests

Queensland buyers have two shared equity schemes to look at, in which a government pays part of the price in return for a share of the home. Their ownership tests point in opposite directions.

Boost to Buy, run by Queensland Treasury, is strict about the past. Its eligibility page defines a first home buyer as a person who does not own and has never owned property in Australia, and applies the same condition to the applicant's spouse. Two things stand out. The word is "property", not "residential property" or "residence", so on its face it takes in land and investment property as well as a home. And, like the grant, it reaches the spouse.

Help to Buy, the federal scheme administered by Housing Australia, is not restricted to people who have never owned. The First Home Buyers website states the condition in the present tense: an applicant must not currently own property, in Australia or overseas, with limited exceptions for single parents. A person who owned a home years ago and sold it can apply. A person who has never owned a home in Australia but still holds a flat overseas cannot.

Help to Buy is therefore the only one of the six that disregards the past entirely and looks at what the applicant owns now. It is also the only one besides the duty concessions that looks beyond Australia.

The super saver scheme: any property at all

The First Home Super Saver scheme lets a person withdraw voluntary super contributions to help buy a first home. The Australian Taxation Office requires that the person has never owned property in Australia, and its eligibility page lists what "property" covers: an investment property, vacant land, commercial property, a lease of land and a company title interest in land.

That is the broadest list of property types among the six. A person who once owned a shop, or a share in a block of land, is outside the scheme even though they have never owned anything that could be lived in.

The test has two softer edges. It is limited to Australia. And it is individual: the tax office assesses each person on their own history and their own contributions, so one member of a couple can use the scheme when the other cannot. There is also a hardship provision. The tax office says previous ownership may not exclude a person if it determines that they suffered financial hardship, as the scheme defines it, and lost the property as a result.

The six tests side by side

The table reduces each test to three questions. It is a summary of the wording described above, not a substitute for each agency's own eligibility checker.

Read down the second column and the range is plain. At one end is a ten-year window; at the other, a lifetime and every country. In between are tests that turn on whether a property was a home, whether it was lived in, and whether it was land.

Five histories, tested

Rules are easier to follow with people in them. The five cases below are invented for illustration. Each result is what the published wording points to; the agencies decide real cases on their facts.

The former investor. A buyer bought a unit in 2015, always rented it out, never lived in it, and sold it in 2019. Under the grant, the unit was owned after 1 July 2000 and not lived in, so it does not by itself rule the buyer out, provided they can show they never lived there. For the duty concession the unit was a residence and the buyer held an interest in it: the concession is closed. For the 5% Deposit Scheme the ten years run from the 2019 sale, so the door opens in 2029. Boost to Buy and the super saver scheme are both closed, because each counts any property ever owned. Help to Buy is open, because nothing is owned now.

The returner. A buyer owned and lived in a house and sold it in 2012. The grant is closed: a home owned and lived in after 1 July 2000. The duty concession, Boost to Buy and the super saver scheme are closed too. The 5% Deposit Scheme is open, since the sale was more than ten years ago, and so is Help to Buy.

The landholder. A buyer has never owned a home but bought a vacant block three years ago and still has it. This is the case where the answers scatter most widely, and the table shows it with the other two.

The landholder passes the two Queensland Revenue Office tests, because a vacant block is neither a home that was lived in nor a residence. Building on land the applicant already owns is one of the transactions the grant is designed for. The same block fails the 5% Deposit Scheme, which counts land, and Boost to Buy and the super saver scheme, which count any property. It fails Help to Buy for as long as it is owned.

The partner with a past. A buyer has never owned anything. Their de facto partner of five years owned and lived in a townhouse before they met, and sold it in 2018. The buyer plans to purchase alone. The grant is closed, because the test is "you or your spouse". Boost to Buy is closed for the same reason. The super saver scheme is open to the buyer, because it is individual. The 5% Deposit Scheme and Help to Buy test applicants, and the buyer is the only applicant. The duty concession's conditions are written about the buyer.

The arrival. A buyer moved to Queensland from overseas, where they owned and lived in an apartment that they sold before leaving. They have never owned anything in Australia. The duty concession is closed, because the apartment was a residence somewhere in the world. Every other test is open on ownership: the grant, the 5% Deposit Scheme, Boost to Buy and the super saver scheme all ask about Australia, and Help to Buy asks only about property owned now. Each of those schemes has separate conditions about citizenship or residency that an arrival would also need to meet.

Spouses, partners and co-buyers

The cases show that the most common surprise is not the buyer's own history. It is someone else's.

Under the grant and Boost to Buy, a spouse's past ownership counts whether or not the spouse is buying. The Revenue Office's definition of a spouse includes a de facto partner of two years or more, so the rule can take effect without a wedding and without any decision by the couple: a relationship simply passes its second anniversary. A buyer who qualified when they started saving may not qualify by the time they sign.

Under the 5% Deposit Scheme and Help to Buy, the test is applied to the people applying. That makes the composition of the application matter. Two friends or siblings buying together are each tested. So are both members of a couple who apply jointly.

Buying with a parent, or with a friend who has owned before, raises the same issue from another side. The Revenue Office's application guide says all owners of a home must be applicants for the grant, or be identified as a non-applicant spouse. Putting a previous owner on the title to help with the loan is therefore not a neutral step for the grant, and it has consequences for the duty concession as well. Families weighing that arrangement against a guarantee, in which the parent supports the loan without taking a share of the home, should have both structures checked before a contract is signed.

Declarations, evidence and getting it wrong

All six schemes rest on what the buyer declares. The 5% Deposit Scheme asks for a completed Home Buyer Declaration form with the loan application. The Revenue Office's grant application requires each applicant, and any spouse, to be identified, and the office says it may ask for evidence, as it does where an applicant relies on never having lived in an investment property.

The agencies check, and the consequences of a wrong answer come later, which is what makes them expensive. The Revenue Office says a grant recipient who turns out not to be eligible may have to repay the grant, and that penalties can apply. A duty concession that was wrongly claimed is reassessed, and the office's concession pages say unpaid tax interest and penalty tax can be added to the duty itself. On an existing home priced at $700,000 the first home concession is worth $24,525, so a reassessment is not a small bill.

Most wrong answers are not dishonest. They come from a buyer applying the everyday meaning of "first home buyer" to a test that means something narrower: forgetting a share in a parent's property that was held briefly for estate reasons, not thinking of a block of land as property, or not realising that a partner's history counts.

Questions to settle before signing

A buyer with any ownership in their past, or in a partner's, can sort most of it out with seven questions, asked before a contract is signed and not at settlement.

1. Have I ever been on the title of any property, or held a share of one, in Australia or overseas?
2. Was it a home, an investment, land or something else?
3. Did I ever live in it, and was it owned before or after 1 July 2000?
4. If it has been sold, on what date?
5. Do I own anything now, anywhere?
6. Do I have a spouse or a de facto partner of two years or more, and what are their answers to the first five questions?
7. Who will be on the title of the home I am buying, and who will be on the loan?

The answers decide which doors are open. The Revenue Office publishes an eligibility tester for the grant and for the duty concessions, the First Home Buyers website has one for the federal schemes, Queensland Treasury has one for Boost to Buy, and the tax office issues a determination before any super is released. Each is the authority on its own test, and a conveyancer, solicitor or broker can put a buyer's facts to them. The one thing none of them does is answer for another.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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