What is the first home owner rate of duty in WA?
The First Home Owner Rate of Duty (FHOR) is a stamp duty concession in WA designed to aid first home buyers, who must be Australian citizens or permanent residents, over 18, and have never owned property before, in making homeownership more accessible and affordable.
This concession aims to make home ownership more attainable and affordable for first home buyers in WA by eliminating or reducing stamp duty fees.
On this page, we’ve covered what the FHOR is, FHOR eligibility requirements, and how to apply for the First Home Owner Rate of Duty in WA.
Key takeaways
- Eligible first home buyers in WA may qualify for a stamp duty concession through the First Home Owner Rate of Duty
- The FHOR aims to help make home ownership more affordable for first home buyers and can save eligible applicants thousands of dollars in some cases
- To qualify for the FHOR, individuals must be Australian citizens, 18 years of age or older, have never owned property before, intend to use the home as their principal place of residence, and meet designated value thresholds
- To apply, buyers must seek pre-approval through an accredited financial institution or directly with RevenueWA
- If pre-approved, buyers must complete the necessary forms and provide their transaction record through their settlement agent or directly to RevenueWA
What is the FHOR in WA?
The First Home Owner Rate of Duty is a stamp duty concession designed to make home ownership more attainable for eligible first home buyers.
This government concession helps eligible first home buyers avoid paying stamp duty on their purchase or pay a reduced stamp duty rate. The value of the land, or the land and home, must fall under a certain value threshold to qualify.
If the property is over the threshold, buyers may still be able to get a discounted stamp duty rate.
FHOR for house & land
| Dutiable Value | Rate for Home and Land Purchases |
|---|---|
| $0 – $430,000 | No duty payable |
| $430,001 – $530,000 | $19.19 for every $100 or part thereof above $430,000 |
| $530,001+ | Pays the standard rate of duty |
Source: wa.gov.au
FHOR for vacant land
| Dutiable Value | Rate for Vacant Land Purchases |
|---|---|
| $0 – $300,000 | No duty payable |
| $300,001 – $400,000 | $13.01 for every $100 or part thereof above $300,000 |
| $400,001+ | Pays the standard rate of duty |
Source: wa.gov.au
What are the FHOR eligibility requirements?
Eligibility for the First Home Owner Rate of Duty matches the requirements for the First Home Owner Grant.
To qualify as a first home buyer you must:
- Be at least 18 years or older
- Be a permanent resident of Australia or an Australian citizen
- Use the property as your primary residence for at least 12 months following the settlement or completion of construction
- Not purchase the property on behalf of a company or trust (unless the applicant is the trustee of an individual with a legal disability)
How to apply
To apply for the FHOR, you will need to:
- Apply for pre-approval for the FHOR through an approved financial institution or directly with RevenueWA
- Complete the Form F-FHOG1 ‘FHOG Application and/or pre-approval for the First Home Owner Rate of Duty’
- If you meet the criteria and are pre-approved, Revenue WA will send you a letter of approval and the Form FDA7 ‘First Home Owner Rate of Duty’
- You will then need to submit this form along with your transaction record (e.g., contract of sale and/or the transfer of land) to your settlement agent or directly to RevenueWA
Mock example scenarios
I put together these example scenarios to help illustrate how the First Home Owner Rate of Duty can help Australian citizens afford their first property. As you’ll see, the FHOR can help eligible first home buyers save thousands of dollars in stamp duty fees.
Example #1: Home Value = $425,000
Alex and Sam, a couple living in Perth, have been saving for their first home. They’ve found a property they love, with a dutiable value of $425,000, which falls under the threshold for the First Home Owner Rate of Duty (FHOR) concessions. They are Australian citizens, have never owned property before, and the home will be their principal place of residence.
Steps for Alex and Sam to claim the FHOR
- Eligibility check: Alex and Sam ensure they meet the eligibility criteria for the FHOR, which includes being first home buyers, purchasing a home with a dutiable value below the $530,000 threshold for homes (or $400,000 for vacant land), and intending to use the home as their primary residence.
- Application for pre-approval: They apply for pre-approval for the FHOR through an approved financial institution or directly with RevenueWA. This involves completing the Form F-FHOG1 ‘FHOG Application and/or Pre-approval for the First Home Owner Rate of Duty’.
- Approval and documentation: Once pre-approved, RevenueWA sends them a letter of approval along with the Form FDA7 ‘First Home Owner Rate of Duty’. They prepare to submit this form along with their transaction record (e.g., contract of sale) to their settlement agent or directly to RevenueWA if they are handling their own settlement.
- Settlement and duty payment: At settlement, the duty payable is calculated based on the FHOR. Since their home’s dutiable value is $425,000, which is below the $430,000 threshold, no duty is payable under the FHOR.
- Post-settlement: After settlement, Alex and Sam submit any remaining documentation to RevenueWA if required. They move into their new home, enjoying the benefits of homeownership without the added burden of standard stamp duty rates.
Example #2: Home Value = $500,000
Jordan, a first-time homebuyer in Perth, Western Australia, has found the perfect first home with a dutiable value of $500,000. This property falls within the First Home Owner Rate of Duty (FHOR) concessional bracket for homes valued between $430,001 and $530,000. Jordan is an Australian citizen, has never owned property before, and plans to use this house as her primary residence.
Steps for Jordan to claim
- Eligibility verification: Jordan checks to ensure she meets all the eligibility criteria for the FHOR, which includes being a first home buyer, purchasing a home below the $530,000 threshold, and intending to use the home as his primary residence.
- Pre-approval application: Jordan applies for pre-approval for the FHOR by submitting the Form F-FHOG1 ‘FHOG Application and/or Pre-approval for the First Home Owner Rate of Duty’ through an approved financial institution or directly with RevenueWA.
- Receiving approval: Once pre-approved, RevenueWA sends Jordan a letter of approval along with Form FDA7 ‘First Home Owner Rate of Duty’. Jordan prepares to submit this form alongside her transaction record (e.g., contract of sale) through her settlement agent or directly to RevenueWA if conducting her own settlement.
- Calculating duty payable: With the property valued at $500,000, the duty payable is calculated based on the FHOR for properties between $430,001 and $530,000. For every $100 or part thereof above $430,000, the duty rate is $19.19. This means Jordan has to pay duty only on the $69,999 amount that exceeds the $430,000 threshold.
- Final steps and settlement: At the time of settlement, the specific duty amount based on the FHOR is officially calculated and paid. Jordan follows through with any additional paperwork required by RevenueWA post-settlement.
Duty payable
- Dutiable value: $500,000
- Threshold overage: $500,000 – $430,000 = $70,000 (rounded for simplicity)
- Duty calculation: $70,000 / $100 * $19.19
Jordan will need to pay stamp duty calculated on the $70,000 overage at a concessional rate, making the process more affordable than the general rate.
Jordan’s savings using the FHOR
- General Stamp Duty for Non-First Time Buyers: $19,665
- Stamp Duty for Jordan (First Time Buyer): $13,433
Considering the above, Jordan saves $6,232 by utilising the First Home Owner Rate of Duty.
*Disclaimer: The above examples are fictional and included only for general illustrative purposes. For specific information, seek the advice of a professional. This information does not take into account your personal objectives, circumstances, or needs. Consider reading the disclosure documents for any products and services before making a decision, and seek independent legal, financial, taxation, or other advice to address your particular circumstances.
Summary
The First Home Owner Rate of Duty (FHOR) in WA offers stamp duty concessions to eligible first home buyers, aiming to make home ownership more affordable.
Eligibility hinges on Australian citizenship, being over 18, first-time property ownership, and using the property as a principal residence, with applications made through financial institutions or RevenueWA.
This concession can significantly reduce the financial burden of stamp duty, facilitating easier access to the property market for first-time buyers.
If you have questions on the First Home Owner Rate of Duty in WA or want help applying for the FHOR, our team of first home builder specialists is here to help.
FAQs
Transfer duty exemptions are specific conditions under which buyers are not required to pay the standard transfer duty on property transactions, often applied to certain types of property transfers, such as those between family members or for first home buyers.
You can learn about the WA Government’s Transfer Duty Exemptions and how to apply for transfer duty exemptions here.
There are many grants available for first home buyers in WA, including but not limited to:
- The First Home Owner Grant
- The First Home Guarantee
- The Family Home Guarantee
- The First Home Super Saver Scheme
It usually takes 15 to 25 days to get the money out. Once you withdraw the funds, you have one year to use them to buy or build a residential property in Australia.
You must have obtained a FHSS determination before you sign a contract to buy or build a property. In most cases, once you sign a contract to purchase, you will no longer be eligible to apply for a FHSS determination.
Yes, a buyer may still be eligible for the First Home Owner Stamp Duty even if they do not qualify for the First Home Owner Grant.
A buyer may still qualify for the FHOR if:
- They would have qualified for the FHOG but the transaction was for the purchase of an established home
- They are an Indian Ocean Territory resident who is trying to purchase their first home in WA.
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