How does the First Home Buyer Assistance Scheme work?
The First Home Buyer Assistance Scheme (FHBAS) gives eligible buyers in NSW a full stamp duty exemption on new or existing homes up to $800,000, and a concessional reduced rate on homes priced between $800,001 and $1,000,000. To qualify, you must be buying your first home in Australia, move in within 12 months of settlement, and live there for at least 12 continuous months. The application is handled by your conveyancer at settlement — you don't pay the full amount and claim it back later.
The Fuller Picture
The FHBAS is a NSW state government scheme administered by Revenue NSW. It reduces or eliminates the stamp duty you would otherwise pay when buying your first home. On new or existing homes up to $800,000, eligible first home buyers pay no stamp duty at all. Between $800,001 and $1,000,000, a sliding concessional rate applies — you pay some stamp duty, but significantly less than the standard rate. Above $1,000,000, the concession does not apply and you pay full stamp duty at the ordinary rate.
The eligibility conditions are straightforward but firm. You must be an Australian citizen or permanent resident, at least 18 years old, and must not have previously owned or co-owned a home anywhere in Australia. If more than one person is listed on the contract, all buyers must individually meet these conditions. You also need to move in as your principal place of residence within 12 months of settlement, and live there for at least 12 continuous months.
The FHBAS is separate from the First Home Owner Grant (FHOG), which is a cash payment available for new homes only. Unlike the FHOG, the FHBAS is not a payment — it is a reduction in what you owe in stamp duty. Your conveyancer handles the application at settlement, so the saving appears directly in your settlement figures rather than arriving later as a refund.
What This Means for Your Purchase
The practical impact of the FHBAS depends on what you're buying and at what price. On a $750,000 existing home, standard stamp duty would typically be around $27,000–$29,000 — under the FHBAS you pay nothing. On a property priced at $850,000, you pay a reduced amount rather than the full rate. This changes how you plan your purchase funds: the stamp duty saving can go toward your deposit, legal costs, or inspections, which matters a great deal when you are working with a tight budget.
The $800,000 threshold creates a real decision point in negotiation. A property at $815,000 will attract stamp duty even at the concessional rate, while the same property purchased at $795,000 would attract none. If you are negotiating close to that boundary, it is worth running the numbers on both sides before you lock in an offer. A small difference in purchase price can translate into thousands in stamp duty either way.
There is also a residency obligation that carries real consequences. You must genuinely move in within 12 months of settlement and stay for at least 12 months. If you plan to rent the property out, relocate for work, or travel overseas shortly after purchase, you risk losing the concession and being asked to repay the full duty amount. Revenue NSW does follow up on compliance, so treat this as a binding requirement before you decide to use the scheme.
How This Shows Up in the Illawarra
In the Illawarra, the FHBAS delivers the most meaningful savings for buyers targeting properties where entry-level homes sit between $650,000 and $800,000 — areas like Dapto, Albion Park, Warilla, Windang, and parts of Shellharbour and the Shoalhaven fringe. A first home buyer purchasing a house or townhouse in one of these areas at $730,000–$780,000 would typically receive a full exemption, saving around $26,000–$30,000 at settlement. For buyers stretching to reach a 10–20% deposit, that saving is a genuine difference-maker.
Closer to the coast — Thirroul, Bulli, Fairy Meadow, Corrimal, or central Wollongong — freestanding houses have largely moved above $1,000,000, which takes them outside the FHBAS range entirely. In those areas, units and apartments under $800,000 are often where the scheme remains accessible to first home buyers. If you are targeting the coastal Illawarra, your FHBAS options may be concentrated in strata properties rather than houses — something worth understanding early when you are setting your property type priorities.
Frequently Asked Questions
Does the FHBAS apply to existing homes or only new builds?
Both. The FHBAS applies to new homes, existing residential properties, and vacant land — though vacant land has different and lower price thresholds. The concession is available whether you are buying new or established.
Can I use the FHBAS if my partner has owned a property before?
No. All buyers listed on the contract must independently meet the eligibility conditions. If your co-purchaser has previously owned or co-owned a home anywhere in Australia, neither of you will qualify for the concession.
Is the FHBAS a cash payment I receive?
No. The FHBAS is a reduction in your stamp duty liability, not a payment into your bank account. You simply pay less stamp duty at settlement — or nothing at all if the property is under $800,000 and you meet all other conditions.
What happens if I don't move in within 12 months of settlement?
You may be required to repay the full stamp duty amount, plus potential interest or penalties. Revenue NSW monitors compliance with the residency condition, so this is a genuine obligation rather than a formality to ignore.
Can I rent out the property after I move in for the first year?
You need to live in the property as your principal place of residence for at least 12 continuous months from the date you move in. Renting it out during that period would breach the conditions of the scheme.
Can a buyers agent help me use the FHBAS more effectively?
Yes. A buyers agent can help you focus your search on properties where the FHBAS delivers the largest saving, structure your offer to stay under key thresholds where possible, and make sure you understand the full cost picture before you commit to a purchase.
If you're looking at a specific property and want to understand whether the FHBAS applies and how much you'd save, we can help you work through it before you commit. Get in touch and we'll walk through the numbers with you.
