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The 101 for First Home Buyers - Part 2


Buying your very first home can be a very exciting process, but also an expensive one.  It's very important to fully understand what you are getting into before making what is likely to be your most expensive purchase so far in your life.  Here are some helpful hints that may make the process a little more stress free.

Building your dream home?

From the 1st of July 2017, the Andrew's government will double the First Home Owners Grant (FHOG) from $10,000 to $20,000, payable when a contract is signed for a newly established home. First home buyers may also eligible to receive 50 – 100% off their stamp duty on the purchase of their land. Lenders will take these amounts into consideration when calculating the required deposit for a home loan.

For example, a $200,000 property could be bought with a $20,000 cash deposit and the $20,000 FHOG – a total deposit of $40,000 or 20%. Such a situation might save you from having to pay Lenders Mortgage Insurance, as the deposited amount is 20% or more of the property. This is a huge saving to first home buyers as more funds may be available to put towards to the property build.

This is expected to help over 6,000 Victorians purchase their first home and to build and live in their local communities. Note: the grant is only available to first home buyers building new homes valued up to $750,000 in regional areas (ie. not Melbourne).

Buying Established Home?

As of the 1st of July 2017, the Andrews's Government will axe Stamp Duty for First Home Buyers on both new and established homes under $600,000. First home buyers purchasing a property between $600,000 and $750,000 will receive a tapered discount.  For example, stamp Duty on a $300,000 home will drop from $5,685 to NIL for first home buyers – this gives first home buyers the advantage of being able to put more money into their new property.

What is Stamp Duty?

 Stamp duty is a charge which is applied by the state governments in relation to the transfer of land or property. As such, each state has its own rules - here we have discussed those which apply in Victoria.

Low Deposit Home Loans

Financial institutions generally required deposits to be around 20% of the property value. This is to provide confirmation to your lender that you have the ability to save and are able to meet your monthly mortgage repayments.  In an ideal world you would be a banks model candidate. Depending of the price of the property, first home buyers may not be able to afford the 20%, and that's okay because there may be more options available to you.

Lenders will often allow individuals to borrow above 80% of the property value to own their dream home faster. They do this by adding a one off payment to the loan - lenders mortgage insurance (LMI). The aim of this payment is to protect the lender (not the borrower). The lower the deposit on your property, the higher the risk you become to the bank. This payment is a once off premium, with the payable amount entirely depending on the amount being borrowed. Some lenders may allow the borrower to add the cost of their premium to their monthly loan repayments, - meaning no upfront cost.

Other factors to Consider

Its getting harder and harder for Australian's to save for their first home. These few changes have made it somewhat easier although we still need to consider the underestimated additional costs.

 Items such as home and contents insurance, legal fees, moving costs, inspection reports, council rates and transfer fees need to be well-thought-out. It's important that these additional costs are taken into consideration, as well as knowing exactly how you will make the monthly repayments on you property. 

It is important to shop around; each lender will have different packages to attend to your needs and financial capabilities. Lastly, ask questions, this is so important! It's not everyday that individuals go and purchase homes and it isn't something which you will naturally understand the process of. As such, there is no such thing as a silly question!

If you are interested to learn more about this topic and how it may affect you, you can call or book an appointment on (03) 5032 9422.

The 101 for First Home Buyers - Part 1

Who wants to own their very first home?

Buying your very first home is the Great Australian Dream. It can be a very exciting process, but for some, especially first home buyers and lower income households, it's getting much harder for this dream to become a reality.

Did anyone take note of the 2017/18 federal budget overview? 

No ?

Well here is what's relevant to you!

First Home Super Saver Scheme – 2017-18 Financial Budget

In the 2017/18 financial year budget, the Federal Government have imposed that first home buyers will be able to save for a deposit through superannuation:

-          As of the 1st of July 2017 you can make voluntary super contributions of up to $15,000 per year (or $30,000 in total), to help you save for that deposit on your dream home.

-          Voluntary super contributions can be deductible or non-deductible in your individual tax return. Deductible contributions reduce your individual taxable income, and will be taxed at 15% in the super fund when they are deposited. All future earnings within super on the amounts deposited are also taxed at 15%. This gives the potential to save you up to $5000 in income tax, depending on your circumstances.

-          After the  1st of July 2018, these contributions can be withdrawn for a first home deposit only. Deductible contributions and earnings that are withdrawn will be taxed individually at the marginal rate less 30% offset.

The first home super saver scheme can potentially boost savings to put towards a deposit by at least 30%, as opposed to a standard deposit account. This is due to the concessional tax treatment and higher rate of earnings realised within superannuation.

This may be a huge benefit for home buyers, particularly in regional areas where $30,000 is seen to be a sufficient amount for deposit on a new home. This incentive provides first home buyers the chance to build their savings more quickly and purchase a home that they are happy with. The $30,000 contribution limit is per person, so couples will be able to both access the scheme and combine their savings for a single deposit.

The ATO has assumed the responsibility of administering the First Home Super Saver Scheme. They therefore are responsible for determining the eligibility of the person seeking a release of funds, and to approve the released amounts based on the information provided by the applicant and superannuation fund.

The ATO will also administer compliance mechanisms to ensure that people purchase their first home after they release monies from the superannuation fund. This means the amount withdrawn is not allowed for personal use, it is designed entirely for a home loan deposit. 

If you are interested to know more about this topic or how it may affect you, you can call or book an appointment on (03) 5032 9422.

If you haven't noticed over the last few years, metropolitan and suburban football has been struggling.  Small community football clubs all across the land are folding or merging, as they can no longer support escalating player payments along with dwindling volunteer help.

However, 2017 marks the first year for the Community Club Sustainability -Player Payment Rules. Put in place to maintain support and grow Australian Football at Community Level, while ensuring competitions are evenly matched and clubs financially viable.

From this season all player payments (match payments, cash incentives, bonuses, travel allowances, finals appearances and payments for other non playing roles) will be reported to the AFL before the season starts as a budget. Payments that have actually been made will then be lodged and reported to the AFL at the end of the season, post finals.

The 'salary cap' has been introduced in to stop financially stronger clubs being able to obtain an unfairly large proportion of the best players at the expense of the financially weaker clubs. Its aim will also be to boost memberships at all clubs, due to the more-even competition, which hopefully produces more volunteers.

Customarily, in the past, all or part of player match payments may have been 'cash' with the other portion being an actual 'wage' or 'travel allowance' and possibly appearing on a PAYG Summary.

'Cash' payments require no reporting on the clubs behalf and they do not form part of your taxable income. 

If you have received a wage or allowance from football you would have received a PAYG Summary and it would form part of your taxable income (treated exactly the same as a PAYG Summary you received from other employers). You would need to keep record of this for when you lodged your Income Tax Return.

With the new Salary Cap and player contracts in place in the 2017 season -  all match payments, cash incentives and bonuses will have to be reported by your football club to the AFL and also the Australian Taxation Office (ATO). This means you will receive a PAYG Summary and the Income you receive from Football will be taxable income.

The AFL have put in place severe sanctions for both Clubs and Individual Players if Player Payment Rules are not adhered to, which range from monetary sanctions, clubs forfeiting the right to register specific players, players forfeiting the right to register for a specific club or league, relegation of clubs and loss of or ineligibility of Premiership Points for past, current or future years.

So what does this mean for you as a Footballer?

Well to put it simply, you are now recognized as an 'employee' of your respective football club if they pay you in any way, shape or form. Any income received will have to be declared, but footballers may also be able to claim deductions against this income for football related expenses.

As well as this, players may also be entitled to Super Guarantee Contributions of 9.5% of their earnings from their employer, the football club.

To find out more information on what you may have to declare and what you may be able to claim as a footballer, call us on (03) 5032 9422



Last Thursday night 6 representatives of GMG went to hear Chris Helder speak to an audience of approximately 90 people at Spoons Riverside, arranged by Swan Hill Inc.  Chris is a certified practitioner of Neuro-Linguistic Programming specialising in advanced communication and behavioral modelling.

Chris provided us with a high energy and entertaining account of personality characteristics, body language and how we can identify these.  This is designed to help us to be more aware of our own personality traits and also of those around us.

He also taught us his useful everyday communication techniques that can help us not only personally but professionally based on his FORD principle – Family, Occupation, Relax & Dreams (vulnerability).

Chris was an informative, entertaining and insightful speaker and I'm sure everyone who attended learned a great deal.

Below is a photo of our very own Ash Lawry with Chris Helder 

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