First home super saver

Spaceship Super

First home buyers in Victoria

Making the most of the First Home Super Saver scheme, the First Home Guarantee, and other help for Victorian first home buyers.

The information on this page is correct as of 1 June 2023 and may change. Check out the VIC Government and ATO First Home Super Saver Scheme websites for the latest information.

Your first home in Victoria

There’s extra help on offer for Victorian first home buyers.

First home super saver - First home buyer grants

First home buyer grants

Victoria has two state government schemes to help new home buyers. The First Home Owners Grant can contribute up to $10,000 to eligible residents who are building or purchasing a brand new home up to the value of $750,000. The second is the Victoria Homebuyer Fund - a shared equity scheme where the Victorian Government pays for and owns a stake in your home.

First home super saver - Upfront cost help

Upfront cost help

The First Home Guarantee is a national program designed to lower the amount of deposit you need, by providing a guarantee for some of your home loan, thereby avoiding expensive Lenders Mortgage Insurance. Eligible first home buyers can also apply for a Victorian stamp duty exemption on homes up to $600,000 (or a concession on homes up to $750,000).

First home super saver - Tax help with saving

Tax help with saving

First Home Super Saver (FHSS or FHSSS) is a scheme that helps Victorians save more for their first home deposit in their super accounts, where it’s generally taxed at 15% tax rate - well below most people’s income tax rates.

How it could work for you in Victoria

Caroline wants to buy her first home in Geelong. It will cost $600,000 and she is excited about this as the property is in good condition. Here’s how Caroline handles her house purchase.

  1. The townhouse costs $600,000 so she doesn’t have to pay stamp duty as a first home buyer.
  2. Caroline qualifies for the Victorian Homebuyer Fund (VHF) and she decides to have the State Government purchase the maximum 25% of the townhouse, which means she avoids having to pay Lenders Mortgage Insurance.
  3. Over the past few years, Caroline saved around $40,000. She put $30,000 of this into her super, adding $15,000 in each of the two years, funds she can access under First Home Super Saver. As Caroline’s income tax rate of 34.5% (including the Medicare levy) is well above the 15% rate of tax on super contributions, she saves thousands in tax.
  4. Now that she’s ready to buy her first home, Caroline uses the First Home Super Saver scheme to withdraw her super contributions. The ATO determines her maximum release amount and associated earnings. Here’s some more about how that works.
  5. Caroline puts all her savings together and breaks the good news to her dog – he’s getting a backyard!

Tip – If Victorians wish to pay a smaller deposit than 20% and avoid paying Lenders Mortgage Insurance, the Victorian Homebuyer fund is not the only way. The federal First Home Guarantee provides an alternative and you can apply and be eligible for both.

Join Spaceship Super

Join Spaceship Super

Saving more with the FHSS

How does the First Home Super Saver scheme work?

The FHSS scheme lets you access some of your super to help cover your mortgage deposit - but you can only withdraw super that you paid yourself e.g. through salary sacrifice or a voluntary after-tax contribution for which you claim a tax deduction. 

Effectively this means you’re getting a tax concession to help you save your mortgage deposit! You can also use after-tax contributions on which you haven’t claimed a tax deduction.

If you’re ready to buy and have been topping up your super over the past few years, you might have enough now.

If you’re still saving up, then you could do so through your super, so when you’re ready, you can take out up to $15,000 worth of contributions per year up to $50,000 in total plus the earnings in super.

Saving through FHSS, plus any use of the Victorian first home schemes, can bring first home ownership within reach.

How do I save using the FHSS?

To save money via your super - and the FHSS - all you need to do is contribute to your super, on top of what your employer pays.

Many workers opt for a salary sacrifice, which sees their employer direct an extra amount directly to the employee's super (instead of to their paycheck).

You could also make a voluntary contribution and then claim a deduction at tax time.

Both methods can see those contributions taxed at only 15% rather than the higher tax rate you’d probably pay on your normal wage - up to a certain limit.

You can also make and use any after-tax contributions you make to your super.

Note, there are limits on how much you can contribute to your super each year.

First home super saver - 7 steps - In simple terms, the FHSS works like this

  1. Check you’re eligible for the FHSS – are you 18 years old or over and a first home buyer? There’s no Australian citizenship or residency requirement to apply.
  2. Check that your super fund allows you to withdraw under the FHSS (Spaceship Super does!)
  3. Start out by contributing to your own super in any of the following ways:
    1. Contribute after-tax money to your super and then a claim tax deduction in your tax return.
    2. Salary sacrifice, by asking your employer’s payroll department to send some of your income directly to your super account instead of to you.
    3. Contribute after-tax money to your super account, without claiming a tax deduction.
    • Options a and b count towards your ‘concessional contributions’ annual cap of $27,500 (including your employer contributions) and come with tax savings.
    • Option c counts towards your ‘non-concessional’ annual cap of $110,000.
    • There’s a $15,000 cap on how much you can save via the FHSS each year. 
  4. Think financial years. Your annual limits reset on 1 July every year. 
  5. When it comes time to start looking for a home, you apply for a FHSS Determination and a release from the ATO.
    Make sure you get the determination before you sign a contract, so you know how much you’re able to withdraw as a deposit.
    Much of the information will be pre-filled, but it will be handy to have a record of your contributions on hand just to check.
  6. Buy your property!
    Once you sign a contract, submit an FHSS Release Request.
    The ATO requires this within 14 days of signing the contract, but it’s best to do it straight away.
    The amount you withdraw via FHSS will be paid into your bank account. In most cases it will take between 15 to 25 business days.
  7. Alternatively, you can submit the Release Request before signing a contract.
    If you do this, you have up to 24 months (an initial 12 months and an automatic 12-month extension if you need it) to sign a contract on your first home.
    If more than one person is buying the home, each person can use their own FHSS as long as they meet the criteria.
    Even if one person is not eligible, other eligible buyers can still apply for the FHSS.

See your eligible contributions in the Spaceship app.
See your eligible contributions in the Spaceship app.

See your eligible contributions in the Spaceship app.

Join Spaceship Super

Paying less upfront with the First Home Guarantee

What is the First Home Guarantee?

The First Home Guarantee (aka FHBG) is a Federal Government initiative to help eligible Australians purchase their first home. Approved buyers can have just a 5% deposit instead of the usual 20% that many lenders require to avoid paying Lenders Mortgage Insurance.

How does the First Home Guarantee work?

Australia’s First Home Guarantee (FHBG) was introduced to help first home purchasers avoid expensive Lenders Mortgage Insurance, which can increase costs by $10,000 or even more. If you don’t qualify for the Victorian Homebuyer Fund, the FHBG may be an alternative way to avoid lenders' insurance.

What are the eligibility criteria?

Generally, to be eligible for the First Home Guarantee (previously First Home Loan Deposit Scheme or FHLDS) in Victoria, you must be:

  • An Australian citizen
  • Over 18 years old
  • An individual earning up to $125,000, or
  • A couple earning up to $200,000
  • Intending to live in the home
  • A first-time buyer

Only residential properties are eligible, but these can include:

  • An existing residence, e.g., house, apartment, unit, or townhouse
  • Land with a separate contract to construct a home
  • A home and land package
  • An off-the-plan unit or apartment

In Melbourne and Geelong in 2023, the property value can only be up to $800,000, and in the rest of Victoria, up to $650,000.

For more eligibility information, visit the FHBG site.

Join Spaceship Super - Your super account to start using the FHSS.