Big Changes for Homebuyers in 2024-25: What You Need to Know
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02 Jul, 2024
Updated: 02 Jul, 2024
As the 2024-25 financial year begins, several important updates and changes are set to make an impact on Australians. From expanded Home Guarantee Schemes to tax cuts and increased superannuation contributions, these changes could affect your financial planning and home loan applications. Here’s a comprehensive guide to help you stay informed and make the most of these opportunities.
50,000 New Places Under First Home Guarantee
Housing Australia announced 50,000 more places under the Home Guarantee Scheme. This scheme helps first-home buyers, single parents, and people in regional areas buy their homes sooner with a smaller deposit.
- 35,000 places for the First Home Guarantee
- 10,000 places for the Regional First Home Guarantee
- 5,000 places for the Family Home Guarantee
5 Expert Tips for Applying to the Home Guarantee Scheme
To make the most of the Home Guarantee Scheme, consider these tips from our experienced brokers:
- Income Limits: Ensure your taxable income is under $125,000 for singles and under $200,000 for couples.
- Save More: Although the scheme requires only a 2%-5% deposit, saving more can reduce your mortgage amount and monthly repayments.
- Show Consistent Savings: Demonstrate a consistent savings pattern and be prepared to cover additional costs like conveyancing fees.
- File Tax Returns Early: Banks require your Notice of Assessment, so file your tax returns as soon as possible.
- Stay Informed: Keep track of deadlines and processing times, submit your applications promptly, and follow up as needed.
Our experts can help you reserve a spot in the scheme. Call us on 1300 889 743 or enquire online today.
Stage 3 Tax Cuts Give Borrowing Power A Boost
Tax cuts are set to enhance your borrowing power. The new rates are:
- 16% (down from 19%) for incomes between $18,201 and $45,000
- 30% (down from 32.5%) for incomes between $45,001 and $135,000
- The 37% tax rate now applies to incomes above $135,000, up from $120,000
- The 45% tax rate now applies to incomes above $190,000, up from $180,000
| Income threshold | Tax rates |
|---|---|
| $18,200 or less | Tax-free |
| $18,201 – $45,000 | 16% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| Over $190,000 | 45% |
You can use this calculator to find out how much you save in taxes compared with last financial year.
Victoria Introduces Commercial And Industrial Property Tax
The Commercial and Industrial Property Tax (CIPT) is intended to replace stamp duty (land transfer duty) and landholder duty on transactions involving commercial and industrial property in Victoria. The tax will be payable in addition to land tax.
CIPT will apply annually at a rate of 1% of the ‘site value’ (unimproved value) of the land. A concessional rate of 0.5% will apply to ‘BTR land’ (land that qualifies for a build-to-rent land tax benefit)
You can visit Victoria’s State Revenue Office for more information on CIPT.
National Minimum Wage Increases
The Fair Work Commission has announced a 3.75% increase to the National Minimum Wage and award minimum wages, effective from the first full pay period starting on or after 1 July 2024.
The new National Minimum Wage will be $915.90 each week, or $24.10 per hour. This applies to employees who aren’t covered by an award or registered agreement.
Super Guarantee Increase
The superannuation guarantee (SG) rate will increase from 11% to 11.5% effective 1 July 2024. This increase is part of the Australian Government’s legislative plan to raise the SG rate gradually, to 12%, by July 1, 2025.
The SG rate applies to the minimum superannuation contribution employers must pay on behalf of their eligible employees. The increase aims to help Australians save more for their retirement.
For example, a 25-year-old earning $78,000 each year who works until age 67 with no career breaks would have $26,000 more in super at retirement with the 11.5% SG rate than with the previous 11% rate. Similarly, a 40-year-old earning $76,000 would have an additional $13,000 in their super balance at age 67 due to the 0.5% increase.
Energy Rebate
The Australian Government announced a $300 energy rebate for every household as part of its 2024 Federal Budget to help alleviate cost-of-living pressures. Small businesses will receive a $325 rebate.
Welfare Payments
Around 1.3 million families receiving the Family Tax Benefit and other family payments will receive increases in their fortnightly payments. The maximum rate for children under 13 will rise by $8.68, to $222.04, and for children 13+, by $11.34, to $288.82. The end-of-year supplements will also increase.
Nearly 1 million recipients of the Age Pension, Disability Support Pension and Carer Payment will benefit from higher income and asset thresholds before their payments are affected.
Deeming thresholds will be indexed, providing more support for around 876,000 part-rate income support recipients.
Income limits for Paid Parental Leave will increase, building on previous expansions to 26 weeks by 2026 and the commitment to pay superannuation on Paid Parental Leave from 2025.
Make The Most Of This New Financial Year
The 2024-25 financial year brings numerous opportunities for homebuyers and homeowners. With the right guidance, you can maximise these benefits and make informed decisions.
At Home Loan Experts, our knowledgeable brokers are ready to assist you every step of the way. We’re here to help. Call us on 1300 889 743 or enquire online free, today!
