Listen

First Home Buyer Choice guide

This guide centralises key information on the First Home Buyer Choice (FHBC) Initiative and provides industry professionals a greater understanding of the legislative and operational requirements when an eligible purchaser/transferee is choosing to opt into property tax.

For a comprehensive understanding of the FHBC, it is recommended that the guide is read in its entirety.

Chapters

1. First Home Buyer Choice overview

On this page

From 1 July 2023, First Home Buyer Choice (FHBC) will no longer be available. Eligible first home buyers who exchange contracts on or before 30 June 2023 will have until completion of the agreement to opt in to FHBC.

Retrospective applications to opt into property tax closed on 30 June 2023.

Those who have already opted into FHBC will not be impacted.

On 1 July, the First Home Buyers Assistance Scheme (FHBAS) will be expanded. See the FHBAS guide for details.

What is First Home Buyer Choice?

First Home Buyer Choice is an initiative that allows first home buyers the choice to either pay the existing upfront transfer duty or an annual property tax when they are acquiring:

Residential land (a new or existing home) for up to and including $1.5 million, or
Vacant land on which they intend to build a home for up to and including $800,000.

Commencement date

The Property Tax (First Home Buyer Choice) Act 2022 received royal assent on 11 November 2022 and commenced on the 16 January 2023.

Eligible purchasers/transferees can apply to opt into property tax, provided the agreement for the acquisition was first made on or after 11 November 2022 or, if there was no agreement, the transfer occurred on or after the 11 November 2022.

Transitional provisions

Under the transitional provisions, if settlement occured between 11 November 2022 and 15 January 2023, eligible purchasers/transferees who have paid transfer duty can apply to retrospectively opt into property tax and obtain a refund.

The application must be lodged between 16 January 2023 and 30 June 2023.

Off the plan purchase contracts signed on or after 11 November 2021 which settle on or after 11 November 2022 may also be eligible to opt into property tax.

How is property tax calculated?

For properties opted into property tax, the annual property tax payments will be based on the land value of the property. The property tax rates for 2022-2023 and 2023-2024 will be:

$400 plus 0.3 per cent of land value for properties whose owners live in them
$1,500 plus 1.1 per cent of land value for investment properties.

Once a property is opted into property tax, the eligible purchaser/transferee will remain liable for annual property tax until they no longer hold an interest in the property.

For detailed information on property tax refer to Chapter 12 – Property tax.

Options available for first home buyers

Existing grants, schemes and initiatives for first home buyers remain available.

Depending on their eligibility, a first home buyer may consider applying for either First Home Buyer Choice (FHBC) or the First Home Buyer Assistance (FHBA) scheme.

The following table provides a general comparison of FHBC and FHBA based on the dutiable amount.

If an eligible purchaser is…	And…	Then...
Buying their first home	The dutiable amount is less than $650,000	The FHBA exemption is available
	The dutiable amount is between $650, 000 and less than $800,000	The eligible purchaser can choose to pay a concessional transfer duty rate under FHBA or, not pay duty and instead opt into paying an annual property tax under FHBC.
	The dutiable amount is from $800,000 up to $1,500,000	The eligible purchaser can choose to pay full transfer duty or opt into paying an annual property tax under FHBC.
Buying vacant land intended to be the site of their first home	The dutiable amount is less than $350,000	The FHBA exemption is available.
	The dutiable amount is between $350,000 and less than $450,000	The eligible purchaser can choose to pay a concessional transfer duty rate under FHBA or, not pay duty and instead opt into paying an annual property tax under FHBC.
	The dutiable amount is from $450,000 up to $800,000	The eligible purchaser can pay choose to pay full transfer duty or opt into paying an annual property tax under FHBC.

The First Home Buyer Choice Calculator can be used to check eligibility and provides a comparison of the estimated property tax and transfer duty.

Additional resources

Support and Service

Support for conveyancing professionals - 1300 308 863

Support for retrospective refunds (professionals and purchasers) - 1300 139 814

FHBC general enquiries for purchasers - 1300 135 195

Email for retrospective refunds: [email protected]

Email for general enquiries: [email protected]

Enquiries can also be lodged in eDuties.