First Home Saver Accounts | First Home Saver Accounts | 2010 Budget Changes

Mike	\| \| 2010-05-12 20:35:32

The four years things was a big problem with this scheme, so yes I think this change helps quite a bit

Tim	\| \| 2010-05-18 21:13:56

It's a step in the right direction but there should be no time restriction as to when the funds can be used for purchase.

Jdawg

| | 2010-05-28 20:19:05

if you consider what you have just said anyone could open an account 30 june - deposit $5,000 then on 2 july withdraw the $5,850 (i.e. $5,000 + 17% government contribution). The account should have at least a 1 year time restriction.

TJ	\| \| 2010-06-09 23:18:00

I opened a FHSA sometime ago but haven't deposited any money into it because of the restrictions. I'm expecting to purchase a property in the next 18-24 months, so waiting for 4 financial years to access my deposit isn't an option.

I don't see why the government shouldn't allow access to the money at any time to purchase your first home.

The $850 (if you deposit at least $5000) is only deposited into the account after you're tax return has been processed. While you could do what Jdawg suggest, I doubt there are many first home buyers that would deposit funds on the 30th, lodge their tax returns to get the co-contribution and then settle on a property within a month and withdraw the money. Even if they did who really cares? The scheme has been budgeted for and if they're purchasing a house they must be working and paying taxes (and probably will be for the next 30 years).

There's also the situation where you make deposits into the account and purchase a property before the end ...

TJ	\| \| 2010-06-09 23:20:59

of the first financial year. In that case you wouldn't get a co-contribution only the tax discount on the interest for the months the account was open.

The only way these changes will be of any use is if all banks offered FHSA and you could transfer the FHSA to the bank that will hold your mortgage. The bank could then consider it to be part of your deposit or security and offset your mortgage against the value in the FHSA until the 4 yrs are up and the money can be transferred to the mortgage.

Ana	\| \| 2010-07-30 10:53:16

I agree with TJ. My husband didnt read the fine print and transferred $5000 int the FHSA no realising it had to stay there for 4 years. We are planning to buy a house in Jan/Feb so the fact that you still cant access that money until the 4 years is up doesnt help us at all. Unless the bank considers that as part of your deposit, I dont think the changes make any difference. Its the 4 years thats the problem. 1-2 would suffice.

Rachel

| | 2010-09-23 15:39:17

I agree the the 4 year rule is a huge problem and certainly share your frustration. However, I think to say that the change to enable FHSA balances to roll over onto mortgages rather than Super after the 4 year period makes no difference is ridiculous. Would you prefer the 5k you have sitting in your useless FHSA to be deposited into your super account or to ultimately reduce your home loan?
We need to push to have this system improved in what ever way possible. So little is being done to ameliorate housing affordability for those attempting to enter the market.

Peter

| | 2010-12-18 00:30:15

Yes, but they don't receive the $5,850 to pay onto their mortarge until the 4 years has passed.

Joe - Good move

| | 2010-06-08 08:24:33

It will be good so that many more can open the a/c to get the saving rhythm going and can also buy a place when they find the place they want to live.Joe

Andrew - Can't be used towards your de

| | 2010-07-16 13:57:33

It appears that, if you buy a home before 4 years, you still need the hold the FHSA for 4 years, and then be able to transfer the funds into the mortgage.

Hence, you won't be able to access the funds for your deposit.....which goes against the spirit of the FHSA policy.

People need to understand this. I don't see many people seeing this change as a huge incentive to open a FHSA account

Ataur - Reply

| | 2010-10-10 19:08:25

I almost agree your conept. It will not help FHSA holders completely if someone has to wait 4 years to use the pricipal amount in mortgate. I also understand that it would be tough to make a contract for first home without that savings amount back from FHSA for many young buyers.

steve - When does this come into effec

| | 2010-05-13 10:29:54

I was a dill who didnt read the fine print about the 4 years in the first place.

If i buy a house before June 30 (which i am about to do) will my cash roll into super or can i put it on my mortgage once the 4 years has past?

I've tried to call everyone but no one can tell me. Wayne Swan probably can't either!

shaun - Mr

| | 2010-05-13 15:38:13

my guess will be that if this does pass through parliment then it could be back dated from 11 may 2009 or could be 1 July 2009 or some other date. But i also think that if you keep holding the account (I am unsure what happens to the account once you buy a home, i imagine you have full control over the funds anyway and that just becauase you buy a house the funds won't magically disapper), if this is the case keep holding the account until this is ratified and then you should be able to transfer to your mortgage.

shaun

| | 2010-05-13 15:39:03

correction with the dates, meant to be 2010

shaun

| | 2010-05-13 16:08:52

quote from press release on treasury website "The changes will apply for houses purchased after Royal Assent of the legislation giving effect to this change."

so what i said above may not be possible

Heidi

| | 2010-11-17 20:25:17

I Hope this is not the case. I purchased a house at the start of the year before my FHSA had been active for 4 financial years. I have been waiting for the budget announcements to be finalised before i transfer the money. I have been in contact with my bank and they are not sure so have told me to leave the account open until the government announces and confirms the amendments, I will be very annoyed if these new changes do not apply to FHSA holders who have already purchased a house, as you cannot predict when the right house for you will come along which is what happened to me. Now i would love for that money i specifically saved to purchase a house to be able to be payed off my mortgage when the 4 years are up!

Admin

| | 2010-05-13 19:58:27

The proposal announced in the Budget is yet to be passed into law, and is still subject to consultation once draft ammendments to the relevant legislation are made available in the coming months.

The Treasurer has been specific about the Government's intentions as to when the change will come into effect:

"The changes will apply for houses purchased after Royal Assent of the legislation giving effect to this change."

Given the current status of the proposal it seems unlikely that any FHSA account holders will be able to 'buy early' and later use their FHSA on a mortgage for at least some months - until it becomes law.

(Read the Treasurer's press release via the link in our Budget article on the home page).

Heidi

| | 2010-11-17 20:28:55

Why cannot the new changes apply for people who have purchased a house before these amendments? The money has been saved specifically to contribute to the expense of a first home so why should it have to go to super?? THese savings would help out significantly especially with all the interest rate rises that have occurred this year!

Patricia doran - Mrs.

| | 2010-09-23 12:46:10

My son & wife have also purchased a home(settlement at end of Sept.) E-mailed Housing Ministry re changes in May budget where funds could be transferred to mortgage as opposed to super. They passed me on to Treasury office. Due to political situation I am STILL waiting on a reply. Rang AGAIN today and am waiting for a call back. This is a fiasco and I agree that Wayne Swan will have no definitive answer either!!

Rachel

| | 2010-09-23 15:45:40

My understanding is, If the government proposal goes ahead, after 4 years of contributing a minimum of 1k per year, the money you have in your FHSA will roll over onto your mortgage.

If it doesn't go ahead, If you purchase a home before you have met the four-year requirement, you must notify your FHSA provider within 30 days, as you are no longer eligible to hold the account. The FHSA balance will be contributed to superannuation and your account must be closed.

Charles - good and bad

| | 2010-05-13 22:14:38

The new change does give people much more flexibility, unfortunately when the FHSA is introduced two years ago. The plan comes together with the First Home Buyers Boost, which eventually driven most house prices in big cities by double digits. So those that joined this scheme in previous years will found themselves like idiots.

I wonder if the government indeed wants to help the first home buyers or the existing home owners...

Kirra - happy!

| | 2010-05-14 12:25:34

I think that's great! because I have a home saver account, have purchased my first home, and the bank and superannuation fund i have aren't able to transfer the money? what the?

eleanor - makes sense

| | 2010-05-14 12:31:42

This makes the scheme much less restrictive and actually helps rather than penalises first home buyers.

It should have happened sooner as many people are struggling with larger mortgages as their FHO savings were transferred over to super where they have little control.

Amanda

| | 2010-05-14 12:36:50

Yes, this is a great idea.

I have a First Home Saver Account and I was always put off by the thought that should I choose not to buy a house, or if I bought one early, my hard earned cash would go into my superannuation. (Where I have almost no control over it!)

I will be crossing my fingers this change gets passed in legislation.

matt - hax?

| | 2010-05-14 14:10:25

I was wondering if you would be able to use this change in your favour. like, say you buy your house and still have the account open, then in the first year of your mortgage, it would be better to put any extra money you get into your FHSA, which pays 20% as opposed to putting it against your mortgage, which would only save you like 7, 8 or 9%.

presumably you would be forced to close the account after the 4 years was up if you had bought a property... but still...
any thoughts?

Bec	\| \| 2010-05-14 16:28:06

Great strategy if you're a rich kid and daddy's gonna stump up the deposit!

Nic	\| \| 2010-05-15 11:20:52

Honestly, if coughing up the deposit is difficult, do you think paying off the mortgage is easier?

Nic - Dr

| | 2010-05-15 11:19:24

Good point, but it would be less than 20%. You would get 17% minus about 3%* for the $5000 you put in the current year.

The money you put in earlier on would be losing you about 3% p.a.*.

So assuming you put in $5000 every year, in the fourth year, you would get an approximate 14% - 3 X 3%= 5%. BUT you would do better in the earlier years.

However, if the difference* is about 4% as opposed to 3%, you more or less break even in the fourth year (lose about 1%). If it is 5%, then you lose in the fourth year about 3%.

Generally, you stand to gain if the difference* is less than about 5%, but it depends on how much longer you have to go and how much already you got in the FHSA.

Which is why I think they should make it more flexible on when it can be used, unless the government wants to please the banks for political reasons.

* The difference in mortgage interest rate and deposit interest rate after tax all of which varies is:

deposit % - tax % - mortgage %

This is currently about 3...

Nic - Dr

| | 2010-05-15 11:31:46

Sorry wrong calculation. The 14% only applies to the $5000 deposited in the current year, so it is diluted out.

In the 4th year (assuming $5000 p.a. deposited), it would be easier to calculate as 17%/4 - 3%* = 4.25% - 3% = 1.25%. (If in 3rd year you would have 17%/3 -3%, i.e. less dilution.)

So in the 4th year, still break even at 4% difference (slightly better off), and lose out if 5% difference.

*3% is difference if you get a reasonably good deal at the moment.

Clare

| | 2010-05-14 15:41:40

This change means nothing if you still can't use the money for a home deposit within the 4 years.

Peter - Mr

| | 2010-11-06 12:21:39

I agree. Deposit should allow to be access in 2 years time.
Government should also consider in contributing more than 17% as house prices are very high.

tj	\| \| 2010-11-07 23:21:03

yeah but the account states 4 years, if you want an extra 2 grand (ie. the contribution), just use the fhsa, or work an extra 2 weeks, and save your self from a locked account

Rach - FHSA fan

| | 2010-05-15 10:35:02

I opened a first home saver account last month. As of 2 July 2012, I can withdraw the money - yes, that's right after 2 years. That's because the fhsa works on financial years. For me it was a no brainer. I'm currently paying 38% tax on the interest earned on my savings (vs 15% for the fhsa). Plus, I get the extra 17% from the govt each year. I wish I had been in a position to take advantage of the extra Fed + state govt grants, but I wasn't, I've only just started a new job paying much better. This way, I get a minimum of 4 x $850, which is 1/2 the extra $7k. I actually think the 4 year (or rather, 2 1/4 years for me) is a good thing - instead of rushing in whenever I see a place I like, I'm having to really assess the value of each place and am getting a much better idea of what constitutes value. I do think it is an improvement that the money doesn't have to go to your super if you buy a place before the 4 (or 2) years is up.

John	\| \| 2010-05-16 14:56:48

Can you clarify the 2 year period you mentioned?
By my calculations if an account is opened before June 31 this year the funds will not be available until 2nd July 2013 (4 years of deposits required: 09/10, 10/11, 11/12 and 12/13).

Also, the wording of it suggests that you would have to wait the full final year, rather than for instance depositing $5000 on July 01 2013 and withdrawing the full balance of the account the next day. That would make minimum date for withdrawal July 01 2014. Fact sheet also says that government co-contribution is added at end of financial year which supports this.

John	\| \| 2010-05-16 15:32:31

Sorry, got dates slightly mixed up in earlier post(cannot edit).

To clarify I interpret the earliest time to withdraw funds as July 2013 as the government co-contribution is made at end of financial year, and I have a feeling the government will make people wait the full final year before withdrawing funds?

eNTe	\| \| 2010-08-19 12:52:54

This website's FAQs suggests that requirements may be met in less than 4 full years. So consistent with Rach's comments on timing of FY contributions, 2+ year period may be all that's required. See FAQs, quoted below:

"Is there a minimum time period that my money is tied up?"
The four year rule would allow you to meet the requirements in less than four full years, provided at least $1,000 was contributed by 30 June 2010, 30 June 2011, 30 June 2012, and again on 1 July 2012

Rach - State & Fed grants

| | 2010-05-15 10:40:30

The only reason I didn't open a fhsa when they first became available was because I was hoping I would be able to take advantage of the extra $7k from the feds & the extra $10k from the NSW govt. That is the one and only reason.

Anonymous

| | 2010-05-15 10:51:26

What would they mean by an approved mortgage under the relaxed ruling? Why can't the government just allow the potential first home buyer to take it out for buying a new home at any time?

Jeff	\| \| 2010-08-19 12:08:06

Because they have designed them for people that require assistance in saving for their first home. They are not meant for people that can buy a house anytime they want.

To pay off a mortgage requires great persistance, 4 years to save for a deposit is a great way to start it.

Nic - Dr

| | 2010-05-15 11:47:55

Assuming you put in $5000 every year, in the 4th year, you would get an approximate 17%/4 - 3%*= 1.25%. In the 3rd year, you would do better: 17%/3 - 3%= 2.67%.

However, if the difference* is about 4% as opposed to 3%, you more or less break even in the 4th year. If it is 5%, then you lose in the 4th year.

Whether you stand to lose or gain in the current year depends on how much you put in FHSA in the current year (to get the 17% from the government), how much you already got in the FHSA (i.e. how much the 17% from the government has to get diluted) and how much the difference* is.

Which is why I think they should make it more flexible on when it can be used, unless the government wants to please the banks for political reasons.

* The difference in mortgage interest rate and deposit interest rate after tax all of which varies is:

deposit % - tax % - mortgage %

This is currently about 3% if you get a good deal.

Tiff	\| \| 2010-05-16 16:44:29

My understanding of the "four year term" is not that you have to have your money in for 48 months; but that contributions must be made over four financial years - so provided you make your first deposit before June 30 in one year; the minimum contribution in the each of the next two financial years; and your final deposit after 1 July two and a bit years later, you have complied with the contributions across four financial years; and can then withdraw your funds immediately for your deposit. The way this website worded the "four year term" seems to suggest 48 months minimum. I hope this is not the case, as I have been working on a 30 month basis for my deposit!

I think the option to buy within the timeframe the account must be opened, and not lose all your money until you're 70 when you can finally access it again is a big step forward. Who thought of that superannuation term in the first place?!

Jeff	\| \| 2010-08-19 12:06:10

My understanding is the same as yours around not requiring a full 48 month term. I agree it is very misleading the way they keep referring to it as a 4 year term. If you read the details it just says 4 x $1000 contributions over 4 separate financial years and it is mature.

The super idea is to motivate people to save gradually and then use this money on their first home. If your not completely set on using this money to purchase your first home then this account isnt for you.

Tommi - Why is this so hard?

| | 2010-05-17 11:52:56

First of all thank you for all the previous comments, I own a FHSA and was in the shadows for a while. Reading through this website does help a great deal. I would constantly complain about this FHSA to Commbank because I'm financially in a position to build, but the 4 year restriction was too much. (Haha, I always thought Wayne Swan heard my whinging and thought, better do something about it.)

Can the government look at offsetting this account towards your actual home loan? Why pay into your account at the end of your four years if you're paying interest during that time. If that is the case wouldn't you be better off just waiting till the end of the 4years in any case and then using it as your deposit? Sure I understand people want to get into the market quickly, however how I was bought to save and in my opinion for people looking at getting into the property market is to have as much saved and paid off.

Can someone please clarify for me.
Tommi (Age 20)

Johnnie

| | 2010-05-17 16:00:11

Hey Tommi

Thanks for sharing your age, it really helps answer your question!

I suggest getting the PDS from the institution you have the FHSA with and read it thoroughly.

Hope this helps enlighten your 20-year-old position on buying a house!

Mike - what's hard about it?

| | 2010-10-08 23:35:36

@Tommi,
Firstly, if you're in a position to build without needing to save for a deposit, you clearly don't need assistance.
Secondly, what's the difference between earning interest in the FHSA or reducing mortgage interest via offset account? Answer: Negligible.
Finally, yes, the whole idea was to get people saving for a while. Anyone who can afford to buy without saving for 4 years shouldn't be getting any assistance.

@All: If you can afford to buy, not complain about FHSA - you don't need it. Just go and buy and be happy. gosh

Kat	\| \| 2010-12-20 13:00:57

I opened a FHSA end of 08 when they first became available. I got the account because my parents offered to contribute my board to the account to help me save a deposit. I met my partner about 2 weeks later, and having now been together three years we have found the perfect house and are ready to buy. Unfortunately i have 25k sitting in my FHSA which we can't touch until July next year, or when these changes finally go through (July will probably come first!!!) these accounts don't take into account possible changes in circumstance. Without my partner i wouldn't be in a position to buy yet, but my circumstances have changed and there is no way to get out of the account. hell, i'd give the gov the extra tax and contribution to get to the rest if i could!!!

Kat	\| \| 2010-12-20 13:39:04

Sorry, meant end of 07.

Jing Jong

| | 2010-05-17 19:47:44

I do not understand how this is a significantly useful change to the existing policy. FHSA are designed to encourage saving for a house, so it stands to reason that money in the account should be available for a deposit (if there *must* be a minimum time limit for the govertment contribution, why not make it a complete financial year?)

Regarding the comment earlier about paying off a mortgage vs saving for a deposit - while you make a valid point, this isn't necessarily a useful comparison in the case of FHSA. If I can afford 2K repayments a month, think about how much the market is likely to move in the >2 years it would take to save for a deposit... any help to shorten the lead time saving for a deposit (even by a few months) could allow first home buyers to enter the market significantly earlier!

Daniel

| | 2010-05-19 04:15:02

Hi, can anyone answer this question. Is there a max number of years you can have the account open. At the end of 4 yrs do you have to buy a house?

Paula

| | 2010-05-19 12:06:53

First Home Saver accounts can be open by anyone under 65, so if you never bought a house you could keep the FHSA account open right up until you're 65.

So looks like you could keep getting the gov't bonus every year until you hit the $75k limit!

Michael Cunanan - Government bonus

| | 2010-10-29 12:45:42

Is only on deposits that financial year, not on the balance.

Greg - Why is this so hard?

| | 2010-05-19 18:48:49

This change will not make a difference to me. I always intended to actually "save" a deposit over the next few years anyway.
Does anyone know how the Govt contribution will be calculated? eg will it be paid annually at 17% pa calculated on the daily balance like most term savings accounts? If you withdraw before the EOFY do you get nothing for that year? If you opened the account in August do you get nothing for the first FY? I find the online calculators very unhelpful in answering any of this.

Jeff	\| \| 2010-08-19 11:55:45

At the end of each financial year, the government contribution is calculated from the contributions you have made.

Rebecca - This doesn't help

| | 2010-05-20 10:58:07

This is no improvement on the current scheme. The biggest hurdle for first home buyers is the deposit. If you can't access the money within 4 years as a deposit then it's useless for me.
I won't be using this scheme. I would use it if you could access the money within four years for a deposit.

Rajeendra Perera - Mr.

| | 2010-05-20 12:55:34

I do not think this change would attract many. The FHB account has been designed for young australians, not those who migrated recently and are now of the ages of late 40s or early 50s (or simply closing to grave). Therefore, I think I will soon start a FSA savings account for my first home in the Lidcombe graveyard.

David - A step in the right direction

| | 2010-05-23 18:46:07

Like many who've opened an account, I've always been somewhat bemused by the 4 year superannuation rule. It's a significant contribution to mortgage savings to engage in this scheme, but this restriction has stopped many from opening an account I'm sure.
I'm ambivalent about the retention of the minimum 4 year term before one can access the funds. Although it won't allow people the flexibility to use these funds for their deposit in some cases, it forces a savings structure which is a good thing. Saving for a deposit is going to be equally rigourous as paying a mortgage people.

Jdawg

| | 2010-05-28 20:14:30

A revised scheme, whereby funds can be contributed toward a mortgage after 4 years will mean that a house can be bought while savings are accumulated at a very favourable rate of return. The revision will make the first home saver scheme appear much more favourable to those people who require the flexibility to consider buying their first home within the next 4 years. The only disadvantage I see in this is that a home deposit must be saved outside of this account if a house is acquired before 4 years.

Jdawg

| | 2010-05-28 20:15:51

And as David has said above - a deposit is next to nothing compared to a mortgage...

Scott

| | 2010-05-29 17:01:12

I wasn't interested in the First Home Saver account before, but now with the possibility of rolling the funds into an approved mortgage at the end of the four year period is a great idea.

I would definitely open one with those changes in place.

Anonymous

| | 2010-05-29 20:56:53

The 4 year lock in period is ridiculous. Possibly a 6 month qualification period after which time funds can be used as a deposit would be a better option. The new changes mean nothing if you can't use your money for a home deposit within the 4 years. Swan you are clueless.

james

| | 2010-05-29 21:05:00

What is the use of the FHSA if you want to buy a house within 4 years? i can't understand why the government won't release the savings in the FHSA for a deposit when people most need it (eg, within the 4 year time).

David

| | 2010-05-30 11:57:21

I think the change is a good idea, but I would like the changes to go further, I don't mind saving for 4 years minimum, but given how expensive houses are now I think the maximum of $75,000 could be increased to $100,000 or more. If I am going to save for that long I intend to save more than $75,000 and it is pretty hard to find a house or apartment anywhere near the city for less than $400,000 now and in 4 years times they will probably be more like $500,000. Don't think too many banks will want to lend me $425,000 at 9% interest. Basically if you don't have a dual income and no kids you will be renting or living a couple of hours from work with no transport and lots of car expenses on top of the mortgage and energy bills. Actually renting sounds ok for the next 4 years or so, I just dont like landlords screwing me for more money time and time again to build their property empire, and I got no choice but to pay up, cause the rental market is so tight. But until the baby boomers start ...

Rachel Carter - First Home Savers Account

| | 2010-05-31 10:30:44

Excellent change, I'd much prefer the money to go into the home loan rather than superannuation. An opportunity arose and I unexpected purchased before the four years.

Mursel Duz - first home buyer

| | 2010-06-06 15:29:50

We have opened this first home saver account 2 years ago and never been told by the bank that we can not buy a house before 4 yrs rule. Me and my wife $25,000 stuck in this account. We couldn't wait and purchase our first home that will be very helpful to get this money into our Home loan account. Please take of this 4 yr rules ASAP.

Jeff	\| \| 2010-08-19 11:42:49

Take it as a good lesson to read the details before signing up to something more severe such as a mortgage...

Tom	\| \| 2010-06-08 14:47:42

Please admin, could you provide further details of which bill will contain this change and when (approximately) it will be tabled.
Also, I can't see any good reason not to backdate this change to the budget announcement. If the gvt believe it's an improvement then let us have the benefit.

ben - First Home Savers Account

| | 2010-06-09 22:00:51

My wife and I both opened a FHSA last year as we had no intention of buying a house for a couple of years, however, with the property price rises throughout last year and early this year we thought it was better to get into the market, rather than wait another 3 years or so and we bought a house.

We knew that this would mean that our FHSA's would be placed into our super accounts, however, we still thought that this was the best decision.

It now turns out if we waited a few more months that we would have been able to contribute our FHSA

ben - First Home Savers Account

| | 2010-06-09 22:03:31

(sorry the complete comment didn't work the first time)

My wife and I both opened a FHSA last year as we had no intention of buying a house for a couple of years, however, with the property price rises throughout last year and early this year we thought it was better to get into the market, rather than wait another 3 years or so and we bought a house.

We knew that this would mean that our FHSA's would be placed into our super accounts, however, we still thought that this was the best decision.

It now turns out if we waited a few more months that we would have been able to contribute our FHSA

ben - FHSA (second half of comment)

| | 2010-06-09 22:05:38

It now turns out if we waited a few more months that we would have been able to contribute our FHSA

ben - FHSA (sorry - last try to get

| | 2010-06-09 22:08:54

My wife and I both opened a FHSA last year as we had no intention of buying a house for a couple of years, however, with the property price rises throughout last year and early this year we thought it was better to get into the market, rather than wait another 3 years or so and we bought a house.
We knew that this would mean that our FHSA's would be placed into our super accounts, however, we still thought that this was the best decision. It now turns out if we waited a few more months that we would have been able to contribute our FHSA

Michelle - FIRST HOME SAVER

| | 2010-06-10 11:13:30

When I opened the account I was NOT informed that the account had to stay open for 4 years or that after the 4 years if a property has been purchased the money from that account would go straight into my super fund.
I am only 23 and do not need the money in my super account at this stage.. If changes are made it will make a HUGE difference!!

john	\| \| 2010-06-10 13:08:03

When I first opened this account no one at the bank explained that I could not have access to the funds till 4 years after opening this account. Now, I wish to purchase a propeerty and it disapointing to hear the bad news. I don't understand how anybody in government could allow some account as this one to be set up. I hope that the legislation gets changed as soon as possible so I can purchase a property and use the funds I have in this account.

Andrew B - Offset option

| | 2010-06-10 19:22:12

If the government is adamant about not allowing release of the money until four years have elapsed, a new clause allowing it to be used as a 100% offset account from two years or so (with contributions continuing) would allow people to purchase, whilst still saving for their home. It is roundabout but would certainly work for me.

J Lee

| | 2010-06-13 19:31:05

To find out that the funds can only be withdrawn after 4 years or put into a super fund is a rude shock, especially when NOBODY at the bank could explain how this account works and the PDS has no information about. Most 1st home buyers are younger than 30 and to be made to wait until they are 60 to use those life savings is ridiculous. The only criteria should be to use it for your first home. If it is going to be used buy your first home it should be able to be withdrawn. That is the whole POINT of the account. It should be able to be put into the mortgage or for the deposit. not just for the deposit.

Simon - Supporter of FHSA

| | 2010-06-15 14:29:06

I think the proposed amendments to the FHSA is great.

I don't think people understand that saving for a home is a long term commitment and cannot be done in 1-2 years. Hence, the Government should not change the 4 year period otherwise you will not have enough for a deposit.

For those people considering the FHSA you need to consider that this is a long term account that will provide you with a high return other the long term and subsequent interest can be earned on the account - leaving you with a nice amount after 4 years. As mentioned, if you are smart about it, you can use it to your advantage and play around with the timing of deposits and ultimately reducing your term.

For those that signed up to the FHSA and didn't know about the 4 yr rule - use your eyes to read the PDS. It is YOUR responsibility.

Marc	\| \| 2010-06-19 20:03:14

Don't you think peoples circumstances can change dramatically in a four year period. Should OUR money that we worked for and have paid tax on be held hostage for 4 years. I think more changes need to be introduced, at least allow the funds to be accessed early and in doing so void the interest earnt.
Is this not a win-win option ?

Jeff - Best post I have read so far!

| | 2010-08-19 11:32:59

Best post I have read so far! Agree 100%

Daphne - FHSA

| | 2010-07-16 13:52:52

I fully support the proposed change to allow the fund to be transferred to a mortgage account after 4 financial year if the account holder purchase a house before then.

The purpose of the FHSA is to encourage house buyer to deposit towards their house purchase. Hence, the account balance should be allowed to be transferred to offset the mortgage account regardless of when the buyer buy the house.

This change will encourage more first home buyer to take up the FHSA.

John - Definitely

| | 2010-06-16 17:10:53

Great change!

Will definitely start putting in more money into that account once those changes take effect.

Connor - Should apply to all FHSA

| | 2010-06-17 14:05:25

The changes should apply to all FHSAs opened and not just those after the legislation is passed. Otherwise, it would be grossly unfair to all who opened one when they were first available.

Marc	\| \| 2010-06-19 19:59:30

I think the account is useless, I have had it for two years and now i am going to buy and i can't even access my funds. Real good way of restricting first home buyers isn't it, so much for building the economy back up. Well i have asked the ato if i give them their measely 17% interest they paid me will they release my funds...so i can only wait to hear their answer for that one!

Nick	\| \| 2010-06-27 13:20:34

I originally got the account as it seemed very appealing at the time and given my circumstances then. Currently, however, I am regreting opening the account as my situation has changed for the better and the possibility of buying a first home is quite real. The problem for me is having this money tied up for another 3 years. I would be happy to pay back any interest I've made with the account if it meant I could use any of my own contributions toward my first home. I would also be very happy if these proposed changes came into effect as well. It seems that these changes would be more economically sound for everyone on a larger scale too.

Sam	\| \| 2010-06-29 13:03:12

I think that the proposed changes are great, but I'd like them to go further - particularly in the case of compulsory rollover of these balances into super for the following reason - if you have saved for a number of years, and are still young, you risk losing a large proportion of your home deposit to super contributions tax. In this case the government will get back in taxes much more than they ever offer as saving incentives.

Tim	\| \| 2010-07-05 14:59:58

does anyone know when the proposed changes are comming into affect?

thanks

SF - First Home Saver Accounts

| | 2010-07-06 12:45:25

I think personally it's great and suits my situation very well!

My girlfriend and I had always planned to put 5k a year in financial years 2009/2010, 2010/2011, 2011/2012 and then post July 1, 2012 to have access to the money. With the first year already taken care of, and both of us getting full time jobs next year, I would strongly advise others take the same lead as us.

We will continue putting the 5k each into the FHSA but because we are living at home (minimal expenses), we will have an alternative stream of savings in a normal savings account/term deposit. We intend to get as close to the deposit figure through our savings accounts and then use the FHSA money as mortgage repayments (provided our lender who will provide an IO loan will allow us - need to find that out).

John	\| \| 2010-07-07 11:26:00

If the first home saver account must be closed, say I have purchased a home within the minimum 4 years, and the money needs to be transferred to my super account, will this count towards my non-concessional cap? what about the government co-contributions of up to $850/year, does this count towards the cap as well? take note that the super gov't co-contribution of up to $1000 does not count towards the cap...

Farid - FHSA is still too restrictive

| | 2010-07-16 18:47:29

Its great initiative for the government to improve FHSA features but I dont think the account will see a great take up due to existing restrictions.
Great for the extra 10% annual contrbution and increasing the cap as it will result in greater deposit if you keep the account for 4 years. What if you want to buy a house before the end of the qualifying period? means that the home buyer will have to gather deposit from another source as their funds are still locked until the end of the 4 years. Other cases could be that the person would not want to buy a house and open a business, travel for a long period or move overseas permanently which they cannot do as the funds can only go towards a house or into super.. I would suggest that the account to be more flexible with the option of withdrawing funds sooner for a house deposit (could be set interest or structured tiers based on the number of years that they held the account- structured tier would be more of an incentive to keep it in for...

Jeff	\| \| 2010-08-19 11:25:38

If the money could be withdrawed to go travelling then it wouldnt be a First Home Saver Account. The benefits the government are providing is to help people buy their first home.

One idea I do support though is if you could withdraw your money after subtracting all the benefits you received over the life of the FHSA. Although this could get messy regarding tax brackets etc.

Beau Robertson - What a novel idea!

| | 2010-07-17 13:12:48

The idea of being able to use savings accumulated using a 'First Home Saver Account' to buy a first home is truly novel. It's almost intuitive.

Initially it seemed to make sense that those saving to buy a house would benefit from having this money channelled into superannuation which they could accesss when 65 or 70. The more I have thought about it though, the more sense it makes that if someone is saving money to buy their first house, they should be able to put that money towards the cost of their home.

OK. Facetiousness aside, of course this money should be available to channel into a home loan! It should be able to be used as a deposit before the 4 years is up! Honestly, how much money does the government think first home buyers can afford to save? For anyone in their late twenties or above, they may not want to wait 4 years to access THEIR funds.

Consider this scenario, a couple are saving to buy a house and each have their own First Home Saver Account. They acc...

Owned but lost - What about a High interest Hom

| | 2010-07-17 13:22:19

I was married and took a mortgage for my first Home. Then 5 years later I was forced by lawyers to give the house to my ex-wife. So why doesn

Lisa - Still concerned

| | 2010-07-23 16:26:11

I don't think the new changes to the 4 year rule make much of a difference as it still restricts me purchasing a property before 4 years is up. I will still need to wait 4 years to access my money for a mortgage - which I can't afford without it - that is I can't afford to buy one in the mean time as my savings will be stuck in that account. 4 years is too long for me to wait.

Felicity - Reporter

| | 2010-07-26 14:49:41

Hi There. My name's Felicity Williams and I'm a reporter at the Herald Sun newspaper in Melbourne. I'm writing up a report on the First Home Saver Account and I'm hoping to have a chat to some people about it. I'm looking for anyone who has a FHS account or were considering opening an FHS account but ended up going with some other savings method such as a term deposit. If you are happy to have a chat with me I'd really appreciate it if you could contact me at williamsfe@heraldsun.com.au. Thanks!

AB2884 - Still Confused...

| | 2010-07-29 21:31:35

I am just about to buy a unit as a great opportunity came up. I have money locked into one of these accounts, luckily not too much as after I opened the account and started depositing my situation changes and I realsied I will likely be able to buy before the 4years is up.

The original rules were that you needed to deposit in a minimum of 4 financial years but that did not have to be consecutive. So if this change does occur can I access my money after 4 years without having to keep contributing in each financial year? because I would prefer to put it all into my mortgage!

Jeff	\| \| 2010-08-19 11:16:40

You need to contribute $1000 in four separate financial years for the account to be mature. So in the 4th year you could put $1000 in on the 1st of July and take all your money out, effectively making it just over 3 years.

Kylie - Bailing out

| | 2010-07-29 23:14:02

I opened a first home saver account today, only after discovering they were looking at changing the rules. I'm confused re the 4 year period as the info provided is unclear. I have found info that suggests you only need to contribute over 4 financial years. This would indicate in my case I could withdraw the funds in July 2014, making it 3 year period my savings would be tied up. I asked at the bank when I opened the account but they had no idea, I knew more than the teller did. After reading the above posts I will be cancelling my first home saver account and withdrawing the funds within the 14 day cooling off period. The interest rate is great, but with the price of housing forever increasing it kind of defeats the purpose....

justin - first home saver

| | 2010-08-02 17:45:21

i have been saving very hard butt prices
are going up and i have two young chidren and i am finding the terms very diffelicalt by the time i bild pries will go up .ihave the deposet but cant releace for two years and two make matters worce bank staff no nothing about the account what do i do

Jenna

| | 2010-08-08 16:23:45

learn to type english?

You just have to wait

Ashley

| | 2010-08-04 17:07:36

While the FHSA seems like a good idea it does nothing to address the real problem. Even if they got it right and there was no four year restriction the fact still remains that property is far overpriced and out of reach. The first thing they can do is get rid of the tax incentives for property investors. Secondly the release of land needs to become more efficient. There are plenty of others too but the point is pouring more money into the demand side of the equation only makes the problem worse. The bottom line is prices need to come down to sensible levels.

Jeff - Agree

| | 2010-08-19 11:09:46

I agree with this 100%. The FHSA is negligible compared to the housing affordability issues out there at the moment.

Roger

| | 2010-08-07 02:23:17

Hi does anyone know when the proposed change will take effect?

Jenna

| | 2010-08-08 16:24:25

Came here to find this information myself. Great that its listed in budget changes, but i was confirmation!!

Jason - Banks Not Helping

| | 2010-08-09 21:23:40

I am interested in opening one of these accounts in the next 12 months after I clear some bad debt. I have recently seen some of media reports about poor take up from the public. Part of the reason would be the lack of support and advertising from the banks. I am gathering so they can push their own products.

Banks and credit unions I was looking at to open up one of these accounts were, St George my current primary bank, CBA, Defcredit, Australian Defence Credit Union, Police Credit Union and Westpac.

Of all of those banks the only one that advertised the account on their website was Defcredit. The only other to offer it at all was CBA, there was nothing on the website, or in the branch, however when I asked at CBA they produced a brochure from behind the counter and werent exactly positively pushing the account. Something to think about for the organisers.

Jenna

| | 2010-08-24 14:29:34

Me bank has the best interest rate so Id go there first.

Fi - First home saver account

| | 2010-08-11 21:46:47

The change that allows account holders to purchase property before the end of the four years is fantastic! As an account holder I find the four year wait to be a huge limitation especially with how quickly land is selling, and me wanting to purchase land, but can't due to the conditions of the account.

Kristy - First home saver account - fou

| | 2010-08-12 15:51:07

Firstly - would just like someone to clarify if they know when the rule that FHSA savings can be transferred into a mortgage will come into affect.

I have some money saved in my FHSA, and if I was certain that I would be able transfer it to a mortgage I would put the rest of my savings in there straight away!

But as it is, I am a casual worker and need to have a stash of cash which is readily available in case I cannot work.

I think FHSAs are a great idea, but I just really wish they'd say something official about if and when the money can be transferred into a mortgage rather than your superannuation. It's very confusing hearing conflicting things so I'm hedging on the safe side.

So, if you know when FHSA will be able to be transferred into a mortgage account, please post it on www.firsthomesaver.com.au as soon as you know!

Patricia

| | 2010-09-23 13:08:31

The changes were announced in May budget. Not legislated at this point in time. I have contacted my local member, the Housing ministry and Treasury and NO-ONE can provide me with a definite answer! However I am STILL trying and will demand retrospectivity for the proposed changes.

Marco

| | 2010-08-14 12:56:21

I'm sad that I will have to wait at least 2 years and 2 days to buy my first home upon opening a FHSA.

Locking my miniscule deposit up in a FSHA under the ill-informed impression the Govt would change legislation to allow me to access the funds UPON purchase of my property means I'll probably only contribute the minimum $1,000 to retain access to my funds and still fail to have a deposit when I buy in 2011.

I didn't expect to have a big deposit, yet I thought the FHSA and First Home Owner's Grant could allow me to avoid mortgage insurance. Now if I wait 2 years and 2 days, the grant may be taken away and the hard efforts of saving in a FHSA will evaporate. I'm sure house prices won't fall $7,000 IF and when the grant is taken away.

The FSHA idea is great, yet I think still impractical. I wonder if Wayne Swan would promote a FSHA to his own son or daughter (assuming he doesn't just drop a $50,000 deposit in their laps)

Tony - Changes? When?

| | 2010-08-17 16:19:25

I am very disappointed at how the government isn't disclosing further information regarding the changes to the 4 year rule. Nothing has been mentioned since the budget report.
I understand that it takes time for this new proposal to be legislated but i wish the goverment would give us a more accurate time indication of when it is going to occur so that we can plan out our home buying strategy.

Jeff - Missing the Point

| | 2010-08-19 11:04:12

I think people are missing the point of the FHSA. They are for people who are struggling to save a deposit for a house. Not for people who could buy a house whenever they want.

These changes make very little change to me as for the people its designed to assist, how can they pay for a deposit without using their FHSA money? The only advantage I can see is if they came across some money from their family they could buy a house straight away and then put their FHSA money in later when it reaches the 4 years.

I think its a good change but not a huge one.

Lots of my friends rubbished the idea when it started saying the 4 years was too restrictive. I said I bet noone here owns a house in 4 years, this is still true and I have a nice deposit ready in my FHSA and they have next to nothing.

It doesnt have to be a full 4 years either, 4 x $1000 payments in four separate financial years so you could do it at the end of the first financial year and the start of the 4th making it a little ...

Hans	\| \| 2010-08-19 12:36:42

None the less the number one reason cited for not taking the account up is the perceived risk of losing your savings due to a change of circumstances. This is a valid concern, and as such the government should look at altering the rules that could prevent first home buyers from accessing their savings when they need them most.

Jenna

| | 2010-08-24 14:32:53

As Hans said, the number one reason people do not take up this account is because of the four year restriction. No one knows if they will get a massive payrise or something that means they may be able to buy a house.

Julia Gillard even said she doesn't understand why more people dont take them up, so obviously they want more people to use the grant, so why not remove the reason no one wants them!

Sieuy - the evidence is enough

| | 2010-08-22 10:42:26

After reading all these posts, it's quite evident that the government should ease up on that 4 year restriction to get more demand from all the house hunters in Australia. Who can plan 4 years in advance to buy a house? If we see a great bargain on a house that we really love, we'd want to get it straight away. We wouldn't be able to wait 4 years because by that time, that house would have been bought by property investors overseas.

sam - dr

| | 2010-08-26 23:39:18

ya, the new rule to shift contributions at end of 4 yr, for property bought already is gr8.

Tiff	\| \| 2010-11-05 01:14:49

When is the government going to get on and make the changes it proposed in the budget into law? Does 'consulting' me stalling on this? Or is the government thinking of taking it further and abolishing the 4 financial year rule altogether (a big step forward!!!).

Does anyone in the government read these emails and act on them????

TJ - good

| | 2010-09-04 12:09:27

I think they can do better with the raising of the savings threshold so that we can benefit more (maybe to 1000 atm its 935):) BUT everything they are doing is a step in the right direction. I don't agree they should abolish the 4 year rule.(maybe 3?) The account is there to set up a savings goal over a time period for younger Australians. But allowing you to default the savings into a mortgage after 4 years, is a good direction to go in, rather than loosing it all to my super, which i won't see for another 40+ years!

TJ - fhsa

| | 2010-09-04 12:18:12

Oh, and I hate, how after my tax it takes 6-7 months to deposit the contribution... I miss out on interest, although not much, but every dollar gets me closer to my Great Australian Dream...

(gee)

Brenda - First home loan savings

| | 2010-09-06 09:33:19

It would be a great advantange to be able to contribute to the savings at a before tax situtations , as like superannuation.

Uq5Ck

Elaine - Changes to First Home Owners A

| | 2010-09-12 09:15:01

Isn't the idea of this scheme to help first home owners to save for a deposit on a home - if you have to wait 4 years still to transfer to a mortgage account - what's the improvement?

ina - learn to Germany

| | 2010-09-19 15:37:01

should learn to Germany, buy a house is to live, not to speculation and investment.

Jamie

| | 2010-09-26 08:25:35

I think the time limits are ridiculous. So what if a someone invests $5000 into an account and withdraws the money with the 17% bonus, the gov. still takes their 15% in tax without harming the outcome they are supposedly after, they have helped someone into the property market. It is not as though you can do this time and time again. Give us a break Gov. and lift the time factor.

Than - Mr

| | 2010-10-07 01:16:01

This 4 years period is just a stupid restriction if gov said they wanted to help first home buyers.

Eva	\| \| 2010-10-07 12:06:48

It would be great if we can buy a house now! And still have our money that we have saved put into our mortgage when 4 years is up!

Mike - the increase is good; the earl

| | 2010-10-08 17:54:03

I thought people were complaining about home affordability, now we're saying we don't want to save for 4 years? What a joke!

It's great that we can save more now, and they more allowed the better.
I'd rather be able to save for longer and have no ceiling, so I could buy a nicer home.

Matt - You have no idea

| | 2011-01-05 21:39:23

Hey mike do you realize that in most cases the amount of money you save in 4 years will be lost in price rise of the property in 4 years, not to mention interest rates and the economic climate at the moment but clearly your opinion is not an educated one!! This loan is a joke it does not help at all by limiting your options it is a typical government incentive, poorly thought out and even worse at fixing the problem.

Eric	\| \| 2010-10-08 22:05:35

If government remove the four years restriction it will definitely help first home buyer. At least let it pay into an approved mortgage account. When Circumstances change for first home buyer, it just make it more flexible for us to make decision to buy house now rather then wait another four years.

Lisa Bird - Need more flexibility

| | 2010-10-09 09:03:08

The four year restriction is too restrictive. If the aim is to help people buy their first home, then the only restriction should be on how the money is spent - on a first home. Help us out by allowing us to take advantage of the slow market before house prices rise again in the next two years!

Mike - need help for flexibility??

| | 2010-10-09 09:25:14

sarah - Get it going already!!

| | 2010-10-09 09:56:14

I think the changes are good and I wish they'd just hurry up and implement them so I can start an account! I've been waiting since they first announced it. Along with others I'm not sure why they have imposed the 4 years, so would be good if they explained that a bit better. But overall as long as it goes into my mortgage anyway it doesn't matter that much to me that it can go in after I buy the house. You can hardly complain when you are getting this much support!!

J	\| \| 2010-10-09 11:04:56

The benefits of this scheme are tiny compared to the magnitude of the sums required to buy a house.

And, the benefit is delayed well beyond when the money is need.

This is a positive change, however, lets get real, first home buyers need a far greater uplift.

Mike	\| \| 2010-10-09 11:26:00

How is it a positive change (reducing the minimum time the first home buyer must save for) for a person who needs assistance in purchasing a house?

A good interest rate with tax concessions plus a substantial government bonus is far more than house prices will be increasing. Make it a minimum 10 years saving and no-one will be able to complain about lack of affordability.

I'm so sick of Gen Y brats wanting handouts and wanting a fancy 4 bedroom 2 bathroom 2 car garage and wanting it now, but not willing to stop buying cars and play stations and fancy coffees, then complaining that people who have worked hard all their lives are buying the homes they want reserved for them.

God help Australia if we need to go to war. I don't see our young people willing to make a sacrifice.

Matt - Are you normal

| | 2011-01-05 21:55:00

Mike do you get what the problem is or are you that simple, there is no need for the government to put a 4 year restriction on your own money a lot can happen in 4 years. For the people that wanna leave it in there for 10 years they can and good luck to them but is a joke for any one to be able with hold your own money from you using it, it's beyond ridiculous. And if you do buy a house which is the sole purpose of this loan you get punished by the government putting it into a super fund so some one else can decide what to do with it.

Amanda

| | 2010-10-09 12:52:41

The easing of the rules would be enough for me to open a FHSA but it wouldn't be where I'd keep the bulk of my savings. I'd be more inclined to put money into this account to accumulate a lump sum at the end of the four year term to deposit into a home loan account. Four years is too long to wait to withdraw a deposit especially if buying a house is a high priority - in which case you've already saved a chunk of the deposit.

Mike	\| \| 2010-10-09 13:22:09

I give up.

Sarah - Miss

| | 2010-10-09 17:32:40

1 Question???????
Will the banks consider your first home saver account as part of your deposit, if you are buying earlier than 4 years?

Could the Government help Single people, on average income - with no children for once???
Half buy property, and on sale recieve only half..... it's impossible to save a deposit, rent and then buy if you are single.
Renting & working 20 yrs, and can't get a look in.
Those that rock the cradle rule the world! - this seems so true right now....and they continually complain! They don't know how well off they are.

Sarah - Miss

| | 2010-10-09 17:48:21

lol... mike might be right... I give up,
my Rent has already gone up 80% in 2 years, the more it goes up the less I can save.... over 4 years, my savings ability actually gets less, because RENT, ELECTRICITY, GAS, WATER, FOOD, PETROL and everything else goes up, and my wages don't. and again being single with no children, have to go without already to even save the smallest amount, seriously the repayments on a 400,000 apartment/home are more than i earn! Mission Impossible!

Julie

| | 2010-10-09 17:58:22

It's a great step forward! I'm currently in my 3rd FY of the FHSA, and have been thinking of purchasing a house now, but wasn't able to in the pass. With the new legislation, I'll be able to buy my first home without having to wait for the full 4 years.
The only down side is that I have no money saved up for the deposit...so it looks like i'm still struck in the full 4 year term

Vincent

| | 2010-10-09 18:02:41

The government should increase their contributions to $1000, if we are to deposit $5500. Besides that the changes are great!

AT - Does not totally agree

| | 2010-10-10 22:33:59

changes would help but the 4 yr rule is too much wait.... it shoukld be abytime but can only be paid directly to your mortgage when ever you want to use it.

Besides if they want to use it, they wont be able to get the benefits after all... or they have option to leave it on the FHSA accnt and earn more interest and decide when to use it....

They cna only use it to pay for motgage. The money shouldn'tbe allowed to pass on the accuont holders name. It should be automatically go directly to the mortgage.

David Holmes - Mr

| | 2010-10-11 07:41:54

I think the 4 year rule is important to encourage a strong savings pattern.

If the Government is going to relax those rules I think it is important to boost the benefit to those who save for four years or longer.

Sick of being slugged

| | 2010-10-11 08:07:56

The changes make it easier for people to save for a home, but its unfair on those of us who have recently purchased - we worked our guts out and saved like crazy and get slugged with all the high fees, while our taxes go to subsidise other people' homes. Also its unfair that the first home owners grant is per couple, it should be per person, as people who became a couple before buying a house are unfairly disadvantaged, but once again its OUR TAXES paying for these grants. Why not just lower overall fees and charges.

Jean - Ms

| | 2010-10-11 08:38:24

This is great. Finally see something much more practical and truly good for first home buyer. Can

Angelique McInnes - Speaking as a taxpayer

| | 2010-10-11 10:08:17

Will it cost taxpayers less if First Home Savers Account holders buy their homes earlier than the four year time limit?

If there is no maximum time limit then will taxpayers be going to be funding First Home Savers Account holders until they purchase a home?

So with or without changes to the time frame, who is it really costing, the taxpayers or the first home saver?

Are taxpayers subsidising first home savers into their first homes?

Should taxpayers be subsidising first home savers?

Should first home savers be given assistance by taxpayers in this way?

What do taxpayers gain helping out first home savers in this way?

What are first home savers giving taxpayers in return?

Are both gaining from this subsidy or is one gaining at the expense of another?

While pondering the above, have and outstanding day:D

Jack - Mr

| | 2010-10-12 00:26:47

My Friend ,
You are missing the point here.
Most of people not happy about this FHSA account is the way Government conducted, "this 4 years restriction was never clearly mentioned when it was introduced and lots of people are trapped now".
Most of the people will be happy if they can access their own money when they found the house they want to buy, even not receiving that 17% interest , we still happy .

This is one of the Labour Government style, there is good intention but always with some stupidity or not very well thought of the matter.

Yes , all first home buyers are hard working , paying taxes, trying hard to get out of this rat race of higher retal accomodation/home ownership.

I have no doubt this government want to help people but I am not so sure if they know what they are doing.

Nikki - Speaking as a taxpayer

| | 2010-10-14 20:37:11

Speaking as a hard working taxpayer and first home buyer, here's something to think about....

First Home Buyers (myself in particular) inject a fair amount of hard earned money into the economy. When we brought there was legal fees, all kitchen appliances, laundry appliances, bedding, furniture, linen, lawn mower, food - everything you need when you move out. Before I brought I still lived at home with parents. So my partner and I would have easily spent $10,000 - $15,000 buying essentials for our home.

Everyone I speak love to get as much BACK from the government as they can and I'm sure if you could you would.

If you were GIVEN money for putting saving money then I'm sure you would jump at it. Oh but wait....there is a way ....super co-contribution. Hmmmm.... that's another taxpayer funded project.

Taxpayers are always 'funding' one crap government project after another, get over it - it's always going to happen.

Jack - Look Big Picture

| | 2010-10-15 10:08:48

No point for me to argue or discuss if the Gov should or shouldn't use tax payers' money to fund this scheme or any other scheme. If I want to discuss this sort of things I would rather be in politics.
There is no point here for you too to say people will jump for freebies whenever available. It sounds a bit arrogant and irrelevant, don't you think.

Speaking of so, people do need to look the overall big picture and make a collective judgement as a good fellow citizen or at least as a good fellow human being.
-How economy is running?
-How jobs are existing or created?
-How country's systems are runnig ? Education, Health, Transport etc?
-How we support aging population?
-How we suppport people with disabilites?
-How we make sure people get good education so they can earn decent income to support their families?
-Are you 100% sure and you can control of your life all the the time that you able/want/happy to work and can pay the tax all the time?
-Are you 100% sure today's...

Mursel Duz - Stuck our hardly savings on FH

| | 2010-10-11 10:58:54

I am 42 years old and in my life many times I tried to save some money for home deposit but couldn

natalie - FIRST HOME SAVERS ARE TAX PAYE

| | 2010-10-11 12:55:39

FIRST HOME SAVERS ARE TAX PAYERS!!!!!....why do people think first home savers are not tax payers!!!?????

.... but i suppose angelique thinks she is the only person who pays taxes???

Who's tax do you think will rise to pay for the pensions of all the baby boomers!!!???
or the debt australia has???
or to fix all the mistakes of the greedy??? I don't call wanting to pay for a roof over your head anything close to that!
, the same ones that pay tax now, and younger children!, including first home savers!

Angelique McInnes - First Home Savers are tax paye

| | 2010-10-13 10:01:50

Renee - Great news for account holders

| | 2010-10-11 12:58:55

I think this is a really positive step to making the FHSA more practical.

The four year time frame initially put me off starting a FHSA as I thought I may be able to get a deposit together in less than four years. However, when I did the sums I thought it was unlikely I would be able to save that much given Sydney property prices.

Now I am really glad I did open an account as it has been a really useful tool for savings - as it can't be transferred back into my regular account, the Government deposits extra money every year if you meet the target and it has much higher interest rates than a basic savings account. And if I do have access to a deposit earlier I will now be able to transfer the account into my mortgage which is much better than my Super which I won

Ronald Inglesby - I'm screwed

| | 2010-10-11 18:53:36

I opened this account over a year ago and the bank never mentioned the provision of 4 years to me. I have pumped a good deal of my funds into the account and cannot access it to buy a house on which my offer has already been accepted.

I am seething.

Shari - No four-year rule!

| | 2010-10-11 21:06:01

I think that the four-year rule should be amended so that if a house is purchased within the 4 years then it is applied to the mortgage. Capiche! It is silly to keep the account open when the funds could be used to reduce the interest on the mortgage. This change would be a win-win for the scheme, as it would be achieving it's purpose then

Chris - I felt i was trapped

| | 2010-10-12 00:01:10

I have the acc opened about 2 yrs ago, was so sad that when i decided to buy house coz that's mean my FHSA
can't be access until i was pensioned!!!

Cassandra - Trapped money wasted

| | 2010-10-12 17:40:34

Some of these proposed areas are a bit ridiculous.

"Money must still be held in the FHSA until the end of the minimum qualifying period (usually four years)"

Does this negate everything you're trying to do?

"Only applies to houses purchased after the new legislation is passed (date TBC)"

What about the people who trusted in the government enough but did have a change of circumstance?

"Existing First Home Saver Accounts will qualify."

Except those who have already purchased.

Kirrily

| | 2010-10-12 17:42:49

I hadn't thought the FHSA was a good idea until after the 2010 budget when they said they were proposing that money in the FHSA could be paid off the mortgage after the four years, even if you had purchased a home within the 4 years. That makes a lot more sense to me than the money being paid into super if you purchased in the meantime! It now makes it worthwhile for me to open one of these accounts, as I may or may not purchase a house within the 4 years, but would still be able to benefit from the savings the FHSA offers. Previously I didn't open one because I wasn't sure when I'd buy a house, but needed all of the money I'd saved to be paid off my mortgage, so couldn't take the risk of having it locked away and being paid into super.

Jackie

| | 2010-10-12 18:35:53

I have a FHSA and find myself wanting to access the money now to put towards my deposit. Maybe allowing access to funds early as long as it is for a deposit could be allowed.

eva	\| \| 2010-10-13 11:30:41

i think this is great, the price of propertys is going up so soon, in 4 years time, i probably cant afford any property

Nikki - Wasted Money

| | 2010-10-14 20:19:38

My now husband(under the direction of his dumb father) invested $10,000 into a first home saver account 2 yrs ago after I said pointed out the fine points. Six months after he did that we brought our first home as interest rates were at an all time low. Although we both had other savings the extra $10,000 would have been a good as we wanted to keep enough funds aside should anything happen (become unemployed or something) but also didn't want to have to borrow too much either.

Some of the new proposed amendments are great, provided their 'approved mortgages' include mortgages that have redraw facilities (as majority of home loans do) - this should be available to all FHSA new or existing. I think the 4 yr ruling is a little stupid. Perhaps the FHSA should be like the FHOG and they only release the money upon 'settlement' of property. That way it is definately used to purchase a home.

Jocelyn - Four years just isn't that lo

| | 2010-10-15 08:38:45

I think the changes to this scheme are a great idea. The four year time limit is fine, and many people would be in a lot less trouble today had they taken a bit more time an saved a bit more money before rushing into buying a home.
I like the idea that Nikki suggested where money can be released upon settlement, but I think the point of the scheme was to encourage people to save, not to encourage people to open an account, get bonus money and buy the house they always intended to. It was meant to encourage forward planning.
The worst part of this scheme for me was always the fact that you couldn

Jack - Backward Planning

| | 2010-10-15 09:16:39

First Home Saver Account , its purpose is to encourage People saving in order to help them to be able to buy their first home so they don't trap in rental accomodation forever. (Correct me if it is not true)

In 4 years time the house price going up more than 17% (which economist estimating 20% increase) then what's your saving bonus benifit?
It actually went up more than 17% (not even 4 years yet) in most of the desirable suburbs since the beginning of this FHSA scheme.

If you found your house with resonable price before 4 years and you want to use FHSA for deposit but you couldn't, then you just keep paying rent while watching houses price are going up more than 17% after 4 years, then what?

If this FHSA account is holding you back from getting your very first home then it can't be called forward planning , possibly backward planning.
I do like this government's intention but not very much the way they conducted.

Jocelyn - Part 2

| | 2010-10-15 08:39:17

The worst part of this scheme for me was always the fact that you couldn

kris	\| \| 2010-10-15 13:32:49

If the government actually wants this scheme to be succesful, then they should look at enforcing some sort of minimum / standard interest rate on the providers who offer fhsas (i.e. the interest rate must be in line with other saving products offered or something linked with the cash rate) otherwise, (as currently happens) the banks take your money and have it locked in for 4 years and then just keep dropping the interest rates against what the cash rate is doing.
The banks are currently laughing all the way to the... bank, as they pay minimal interest and relly on the government benefits to lure customers in.

Jocelyn

| | 2010-10-15 13:56:08

That would be a good idea, but in the meantime, when I contacted banks about opening an account they all told me funds can be transferred at any time to other banks free of charge - so I guess looking at other competitive rates and transferring your funds could be an option.

kris	\| \| 2010-10-15 14:13:14

true, you can transfer to other fhsas, however the interest rates are rubbish (about 1% less than online savers) at all institutions and there is no real competition to make them go higher, only level with the competitors. After all why go higher when they already have thousands of customers each with thousands of dollars locked in for another three years (for example). 1 or 2% to the banks means big $$'s to them and they know they won't lose many customers by dropping because there isn't any competition out there and customers can't move there money out of fhsas.

Olga	\| \| 2010-10-15 16:46:33

These changes will definitely attract more young people to open FHSA. These days we need as much help as possible, as a dream of ever owing a house becomes more and more unreal. a lot can happen in 4 years, and people are to scared to commit for that long.

WP	\| \| 2010-10-16 07:55:19

The scheme should be flexible to allow people to access the savings before the end of the 4 year term. Those that stay in for the four years would reap the benefits of the co-contributions but those that need the savings before the minimum 4 year term for the purchase of a first home the co-contribution should be able to access it which may result in no or part of the co-contributions.
The legislation should also be retrospective, those that have used the FHSA and purchased a home should be able to redirect that money into the mortgage to relieve repayment stress whenever the new legislation is enacted rather than having it remain in super.

Jack - Agree with WP

| | 2010-10-17 23:11:57

I agree with you WP, it makes so much sense.
They got to let FHSA accessed anytime they need , but like you said may be no or part of gov contribution if access before 4 years.
I think current 4 year restriction damaging the fundamental concept of FHSA contribution .

Leah - Pointless

| | 2010-10-16 12:43:50

The changes to the first home buyer savings accounts are pointless. What people don't realise is that if you find and buy and affordable home before the end of the 4 year period, you can't use the savings towards your deposit, which is the whole point of the account. You can put it into the mortgage, but with no deposit, you CAN'T GET a mortgate. If you wait four years, who knows how high prices will rise. If something becomes affordable during the four years, it's still no help as you've put all your potential deposit savings into the account, so you can't use them.
Pointless.

Jocelyn

| | 2010-10-18 07:55:24

It's not pointless. People do realise that you can't use the money, which is the whole point of the account. I see the point of these accounts as a way of saving for a future purpose. If you think you will want to purchase a house in the next four years, then I don't see why you'd ever sign up for the account.
It's about future planning and saving. Simple as that.

Patricia - Mrs

| | 2010-10-18 08:34:37

I urge all to peruse this contact and make a submission before 4/11/10.

As you are aware, the Government has released for public consultation the Budget announced changes to First Home Saver Accounts.

The new rules will apply to houses purchased after Royal Assent of the legislation.

If you would like to make a submission, details can be found at the Treasury website, under the link for

2012 - question

| | 2010-10-19 19:14:55

if I open a FHSA in 2010 and deposit $5500. however, I buy a house in 2011. Then the following 3 years(2011, 2012, 2013) I still put $5500 in FHSA each year. Will I still obtain the goverment contribution $935 in this 3 years?

cheers

Jo	\| \| 2010-10-20 07:50:09

For the following years, as I understand it, you will still get the interest and whatever, but the Government will no longer give you the $935 after you buy a house. So effectively, your money will just sit there until you withdraw it after the four years.

Amy - Furious!

| | 2010-10-20 07:38:10

I'm sure I signed the disclosure statement four years ago regarding the "four year" rule. Nonetheless, I have scrimped and saved to end up with $22000 in our FHSA (ie our whole deposit!). Anyways, the timing was right in our lives and we signed a contract last week to buy a house and we can't access the $22,000 because I've only had the account for 3 years! It's killin me! The whole purpose of the legislation is that people have access to funds to buy a new home. I'd be happy with legislation that said we can use the $ after the 4th year to pay down the mortgage, but the fact that that amount of money has to sit in a super account for the next 30 years is completely stupid. We should be able to use the money at a time in our life when we actually need it! I completely support an overhaul of this absurd legislation, especially if it applies to pre-existing accounts! Do it!

Too Expensive - House Prices Too High - Banks

| | 2010-10-20 16:16:27

I think most of the couples in their 20's and 30's I know that have bought houses in the last years with the first home bonus's. Rangeing from 200 - 500 thousand will probably loose there houses in the next 5 if interest rates go up....you see they have children, leave work,change jobs, have never paid bills or rent before - They had lived at home bludging off their parents to save deposits, have credit card debts, and are now totally complaining they have nothing left over!! - They have never had responsibility, until now.

Does anyone else think the banks have given too large loans to these young couples??? so that with any slight change in their lives they will not be able to pay the loans??....
I think the bank gives loans based on 2 working people, no children and low interest rates...... not for when they change to one income, 2 children and higher interest rates....... just thinking..........and talking to these couples they think house prices will keep rising and interest r...

House Bubble - House bubble risks behind rate

| | 2010-11-04 00:31:28

read some of the comments on here;

http://www.smh.com.au/business/house-bubble-risks-behind-rate-moves-aba-20101103-17czs.html? comments=85#comments

cheaper in 4 yrs?

anon - I want it NOW?

| | 2010-10-20 21:41:04

I can't believe people put money into account didn't read what they signed?!?!
......4 YEARS....,
If you are that STUPID, not to read the rules and plan in advance...this includes possible life changes....then you are certainly not mature or responsible enough to sign up for a
....30 YEAR house loan!??!??
gee something may change, durrrr...and you might want to change the 30 yr loan you signed up for? good luck...chuck a tantrum..I WANT IT NOW! I say.. boo hoo.

jack - because it's sneaking way

| | 2010-10-25 14:47:20

They only mentioned after 4 years you get your bonus. They never mentioned in that brouchure that you can't withdraw your own money before 4 year without receiving bonus interest.
Don't you think people should get their own money back if they wanted to withdraw before 4 years without any bonus interest?
Do you think Gov know better than us where we spend our own money?

Why you think Gov should do like mobile phone company or credit card sign up, with small fine print you can't read? Even without any fine prints.

tj	\| \| 2010-10-25 18:26:55

you get the 17% bonus interest automatically after each tax return, you also get charged 15% less tax on your interest because you have a fhsa. so 'taking' it out early is not an option. The purpose is to help you save, if you don't like it, you open up a online savings account, with access to it whenever you like.

Michael

| | 2010-10-29 12:48:18

Sadly ME just dropped their rate to 5.50 (was 6.25) - meaning that they are only just ever so slightly better than UBank for saving, comparing their 6.51 * 0.69 to 5.50 * 0.85. I am worried they will drop their rates again and again despite no move by the RBA.

Jennifer - A very good idea

| | 2010-10-25 10:41:50

I have an account with one of the banks and I have been wanting to buy a house ever since the interest rate came down but because i have to transfer my $10000 into my super if i purcahse a house before that i have been waiting but if the years are given flexibilty we can purchase a house now with the deposit we,ve got and then at the end of that 4 years we can recieve our money.this will be a welcome move for me and my other 5 freinds who sign up since 2008..

Liesel

| | 2010-10-28 15:53:14

I found a really cute affordable house which I never thought was possible but can't buy it:( The sooner these changes happen, the better. I thought they had already, just goes to show how efficient our Government is, propose something in May and take as long as you like to pass it. From what I have read there isn't much opposition!

Felicity Williams

| | 2010-10-29 13:24:56

I welcome the Federal Government's proposed changes to the First Home Saver Account. The accounts should help first home buyers, not hinder them. As such they should be flexible enough to allow for account holders to adapt their home investment plans to accommodate changes in life circumstances, house price fluctuations and interest rate movements. I hope the Treasury pushes through their proposed changes as soon as possible!

FisherDeanna26 - respond

| | 2010-10-30 00:23:30

This is good that we are able to get the home loans moreover, this opens up new opportunities.

Jimmy

| | 2010-10-30 13:02:33

In defence of the person who said that the people stupid enough to sign onto a FHSA without reading the fine print - I think that that is a very condescending thing to say.

Who knows what situation you will be in in four years? With the housing market as unattainable as it is, we thought that it would take four years to save a substantial deposit. Luckily we hadnt put 100% of our deposit into the FHSA, but we had found a place that we could afford within the 2 years of starting the account. We took the opportunity. Now, unfortunately we have money now that will never go into our mortgage. And from the comments on this website, it seems like this is a common situation.

The whole point of the FHSA is to encourage young Australians to practice good spending habits and/or to purchase their first home. To restrict the use of this money for four years is counter-intuitive and to deny other people from accessing the money, who had full intent to purchase their first home is saddening.

I ...

anon - Saving not Spending

| | 2010-11-01 00:24:28

Jimmy -
"The whole point of the FHSA is to encourage young Australians to practice good SPENDING habits and/or to purchase their first home."

I thought it was to encourage SAVING! not spending.
If you don't need four years to save the deposit, then you don't need the help/handout!!, to save the deposit - do it on your own and quit asking for extra help you don't need. The money you can't access - put it down to a life lesson, bet you will never open an account again without reading the fine print and considering all options.

Tomas

| | 2011-05-16 17:14:34

Anon, i disagree. assuming you are saving for 4 years and achieve 40,000 savings (192/week) as 20% deposit on a $240,000 house. you are still below the minimum repayments for a $200,000 mortgage (301/week).
perhaps you are suggesting yes rent should commit after this but in reality, this legislation is designed as a forced spending, the requirements to save is LOW 1,000 pa commitment however the purpose of expenditure is very acute. if a politician was asked about this account would they neglect to mention that this is a scheme designed to assist peiople in purchasing their first home?

Jimmy

| | 2010-10-30 13:04:04

I think that the funds for people who have already purchased their first homes should be able to put into the mortgage, not AFTER the legislation is passed!

tj	\| \| 2010-10-30 15:42:25

very true, even though im not in this situation, that sounds fair.

kk	\| \| 2010-11-07 11:16:05

just think of the rise of the property price in the next 4 years, compare to the tiny 4 years government contribution.

Anonymous

| | 2010-11-07 23:19:40

yeah i do agree with that, which is why i wanna buy it earlier... thats the catch, but i guess if you where 18... you really not going to buy a house any time soon... so if you where 22, the money would be waiting..

Sam - Fully on board

| | 2010-11-08 18:52:12

I hope this legislation gets passed, it will definitely encourage more australians to hop on board and also benefit existing account holders.

Ron Hoppenbrouwer - First home savers account- 4 y

| | 2010-11-09 22:42:48

Please hurry up , my wife is pregnant !

Joe - Legislation needed qui

| | 2010-11-10 11:49:52

Legislation needs to be passed soon to provide security that if you purchase a home before 4 years you can apply the saved funds to the purchase immediately or worst case at least use it to towards paying off the mortgage after 4 years.

Damian - Mr

| | 2010-11-19 18:51:24

These changes do not go far enough, I will not be opening one of these until you can access the money when you buy a house, that's the point of the scheme!

Elaine

| | 2010-11-22 15:40:43

I have a FHSA, got $20000 in the account and waiting for this new legislation to get passed. I saw the news in May and thinking "wow that's a good news" because the likelihood that I'm buying a house with someone before the 4 years period is quite huge. I don't want to waste my money (or to only access it 40 years later). 6 Months has passed, has any decision been made by the government yet?

Patricia

| | 2010-11-22 17:11:34

Legislation is still in abeyance. Consultation closed on 4/11/2010. Go to Treasury website to access this info.

Rob	\| \| 2010-11-22 21:01:15

I am sure you can buy a house and rent it. The rule only applies to the first house you live in .

Kat	\| \| 2010-12-20 13:45:35

this is true. after hunting everywhere and talking to every possible gov dept, i finally got put through to the ato. they told me i can buy a house as an investment property and in 6 months when i can access the money, i can refinance and move into the home and dump it into the mortgage if the changes go through. alternatively if you are buying with someone else, have only their name put on the title and don't move into the house, just go guarantor on the loan, then when you can touch the money have your name added to the title and dump the money into the mortgage.

tj - treasury

| | 2010-11-23 00:00:19

i gave treasury a call about 3-4 days ago friday to be exact, they said parliament is closing now, over dec and jan, expect a result by march, the gentleman said, it will happen about 80% since its not a controversa; issue.

Vanessa - Mrs

| | 2010-11-27 11:24:47

I think the changes are definately a positive step. I opened an account but have been concerned about putting too much of my savings into it just in case we ended up purchasing prior to the 4 year term being up. Didn't really want my hard earned savings going to super.

This makes the first home saver account much more attractive. Would be even better if we could choose to exit earlier then four years and use the money towards the purchase of a home.

Anonymous

| | 2010-12-10 17:33:40

when will they paid my 09-10 FHSA government contribution entitlement into my 'blank' FHSA!? is this an ATO or 'blank' bank's issue? so many questions but close to zero answers... is there anybody i can complain to?

tj - ?

| | 2010-12-10 19:25:24

blank FHSA?
ur contribution is added pretty much soon after u do ur tax return.

Kirrily

| | 2010-12-11 09:55:55

I received mine a few weeks ago; I was notified in a letter from the ATO and it was put straight into my FHSA.

Kat	\| \| 2010-12-20 13:50:02

they say they give it to you as soon as your tax return is lodged and the bank info is given to them, however as an accountant i lodge my tax return within the first two weeks of the financial year every year (unless i have a payable... but that hasn't happened in the time i've had the account), and the earliest i've ever got the money is december. so either commonwealth aren't giving them fhsa details (yet the ato has the details for interest on all my other accounts by august at the latest), or the ato are lazy and don't feel like paying you... given the standards of the tax office in australia i'm gonna go the second option...

Steve

| | 2010-12-12 15:36:51

Awful policy as usual.

We will throw money at you to save for your home but chances are you won't be able to use any of the savings to buy your home, then we'll hold it for a few extra years in a cash account while you pay off your loan at home loan rates.

Oh and we'll amend the legislation to "fix" it but in a way which doesn't remove this 4 year requirement which is how it's broken, just awful policy as usual.

Steve

| | 2010-12-12 15:56:55

PS, I'm disappointed because Labour announced in the 2010 budget that they'd let you add the FHSA to your home loan if you bought a house early, there of course wasn't enough information given then to show they meant after 4 years still, which negatively affects your deposit which makes you pay more mortgage insurance which makes the banks take nearly as much off you as you gain from gov co-contributions, unless you can get your depots to 20%, so the Gov is just lining the banks pockets and helping no one else, in fact it makes obtaining a loan entirely unavailable for some buyers because their money is tied up in this account. When it's so easy to change. I suspect because the banks are smarter than the government and pushed for it to be this way. The Banks get their mortgage insurance and they also get a bonus hidden safety net in the FHSA. Or more likely the Labour gov is just being incompetent again.

Tomas

| | 2011-05-16 17:14:05

Not only that, our savings contribute to their net equity allowing them to lend more money and achieve a better financial performance that they can lock away for 4 financial years.

Josh - When will this get Royal Assen

| | 2010-12-13 21:13:40

Does anyone know when this will pass??

tj	\| \| 2010-12-13 21:49:40

about march, call the ato, parliament closes in dec, or has. reopens early feb.

Anonymous

| | 2010-12-13 21:39:10

i was notified in a letter from the ATO stating they've paid my 09-10 FHSA government contribution entitlement but why have ANZ NOT put it into my FHSA yet!!

Peter

| | 2010-12-18 00:40:03

Tomas

| | 2011-05-16 17:13:20

Tell me what happens when you find the right home for your family 1year, 10months into this commitment?
or for that matter after 1 month on the commitment?

Luke	\| \| 2011-01-09 18:39:25

The $5500 limit is to low it needs to be increased to like $10,000 or so

Justin

| | 2011-01-16 11:22:39

The 4 year minimum period is causing a huge problem for me. If i knew about this i would of never opened this account. The next 6 months will be my only chance to be able to offed my own home. Mean while i have to now try and put a minimum of $1000 a year into this account also save additional funds for a deposit.
I think if we payback the government interest we should be able to access the funds before the four year period.

Vic	\| \| 2011-01-17 16:26:45

its a rubbish. it doesn't serve the purpose. they should rename it as "First home savers account, Helping the Australian not to achieve their dreams of owning their own house."

Sushmita

| | 2011-01-17 16:46:51

Australian's first home buyer begging for rapid action regarding this junk government initiative.

Ben	\| \| 2011-01-18 18:29:07

We're having trouble getting our fisrt home organised due to the fact we can't use our first home savers account to buy land to build our first home. I think there should be more flexibilty when it comes to land purchases.

Luke	\| \| 2011-01-19 00:16:29

I actually like the account ive had it 3 years and no regrets opening it. I just wish they would raise the $5500 limit to a lot more cause i want to put like 10 grand in a year.

Tomas - FHSA holder & Home Owner

| | 2011-05-16 17:08:25

The government needs to amend the draft to allow FHSA holders who have purchased a home after the FHSA account was opened to roll the funds into their approved mortgage too.
Don't restrict this to FHSA's opened after Royal Assent because so many of us have worked hard to find the right home and have saved for THAT PURPOSE ONLY.

JB - Updates?

| | 2011-01-21 10:14:35

Does anyone know when the 2010 Budget's proposed changes to the FHSA will come into effect (or when a decision either way will be made)? I'm holding off on this year's deposit until I get confirmation that the auto drop into your super if you buy before the 4 years is scratched.
Where can I find out their timeframes for consultation / action?
Thanks

Anonymous

| | 2011-01-24 14:58:14

i spoke to my local mp and was told that they are expected to be debated next month.

Priscilla Beveridge

| | 2011-01-24 14:56:02

I think the new rule should definately be passed, i do not have any problems with the 4 year rule but my concern is that in my case I may lose the money into my superfund because we will build before the time is up. I think it would be extremely beneficial to have the option of paying the money into your mortage instead.

Anonymous

| | 2011-01-24 23:27:43

Why 4 years? Why can't we just buy our houses with the money we saved in the FH a/c as a full desposit, or a part of the deposit?

Genevieve Hardy - catch 22

| | 2011-01-28 11:29:17

I agree with anonymous. First home savers should have the right to place their money immediately into their mortgage and not have to wait four years. The four year wait will not benefit the first home buyer at all.
If you save and wait four years, housing prices could go up more than what you've saved (this is how ridiculous the housing market is in Australia) and while you're saving you're paying off someone else's mortgage.
When you buy a house earlier you want to reduce the amount of interest you pay the bank as soon as you can - having the money stuck in the first home saver account probably means you would have less money in the long run than if you never put your money in the account in the first place.
Given all the problems with this account, I'm just wondering who is the one benefiting? Can't the government find another way to help first home buyers?

Cabby - 2 years 2 days

| | 2011-02-01 15:27:37

The actual minimum is 2 years 2 days. The rules state after depositing at least $1000 in 4 financial years. so if you deposit $1000 on 30 June 2009, then $1000 1 July 2009, wait a year, $1000 1 July 2010 then $1000 1 July 2011, you have fulfilled the requirement in 2 years and 2 days. You miss out on some government but the interest is taxed at 15% only and the interest is pretty good.

Anonymous

| | 2011-02-17 16:52:58

Is this really the case? Where can I verify this?

Jaloba

| | 2011-02-14 10:29:11

Why would anyone want to deposit more than $5,500 in this account per year? There are no government contributions for money paid after that, and you can find just as good of interest rate with the online savings accounts at the banks. The only reason I am planning to open this account is for that extra 17% "interest" (govt contribution). So, technically, I'll only have to put in about $23,000 in the next 2+ years, and the rest of my savings will go into a separate high interest savings account.

Anyone who puts more than $5,500 in this account per year is being silly. It's not worth it, even for that %15 tax rate on your interest.

JB	\| \| 2011-02-17 18:51:50

I called the ATO today to check that my understanding of the 2 year 2 day minimum was correct. They confirmed that not only could you withdraw on 1 July; you also get the government contribution for that tax year.

So, if I deposit $1000 before 30 June 2011, $1000 in the tax year ending 30 June 2012, $1000 in the tax year ending 30 June 2013 and $1000 on 1 July 2013; I can withdraw the money on the 1 July 2013, and I will still receive 4 years of government contributions.

FR	\| \| 2011-02-28 13:35:39

I read from SMH that even if you buy a house before the 4 years period, you can transfer the money to your mortgage account after 4 years is due. But find out from ATO that this is not reality yet, the money will go to your super if you do that. Wonder when they can implement this. Waiting............

Dom	\| \| 2011-03-26 13:48:17

The changes have still not been passed into law, and if you have bought a house already you can only move your money to super. It is absurd. The changes have been talked about for almost a year. The account is opened for the very purpose of saving for a home. Yet it allows so little flexibility for any change of circumstances. The proposed new laws must be changed to allow people to move the money to their mortgage at any time, avoiding it being locked up to super until retirement, and should be ok to move to a mortgage even if they purchased a home before the new laws take effect.

Anonymous

| | 2011-03-28 14:49:19

I indubitably agree with you. It is ridiculous that these changes are taking so long. The least they should do is give us an indication of when they expect the changes to pass royal assent.

Matt	\| \| 2011-05-02 16:25:57

These accounts are great for people who do not want to buy a house within a few years. I got one late June 2010 thinking i'd buy a house around august-september 2012, but due to changing circumstances and different needs, i purchased a house a month ago. although i was fully aware i would not be able to access the money in my FHSA, i think its unfair that my money could not be used for the purpose i intended. the proposed changes are alright, but seriously, i'll be surprised if they ever happen.

TJ - TJ

| | 2011-05-03 10:22:13

HURRY UP AND PUT THESE CHANGES IN PLACE, I AM SITTING WITH 25G IN MY ACCOUNT AND WANT TO BUY LAND NOW! its beeeen to long a wait.. to long

Antony Davis - Business Analyst

| | 2011-05-04 16:36:06

Change to the plan is definitely a must! Was thinking of availing the scheme but the four year waiting period,else forced super rule made me rethink; however the planned changes, if approved, will help me to decide positively....

Anonymous - HURRY UP

| | 2011-05-05 11:13:34

HURRY UP! IT HAS BEEN TAKEN SO LONG.

Unknown

| | 2011-05-05 11:44:57

Unknown

| | 2011-05-05 14:42:15

You can put in way more than 5500, you still get all the interest, just not the government contribution.
I think people need to remember that this is meant to help you to save for your house, it's meant to provide a kick start for people that otherwise wouldn't be able to purchase anything - it needs to be changed to allow the money to be contributed to a mortgage rather than super, but I think people are taking it further than was ever intended.

none - ...

| | 2011-05-10 09:31:12

these accounts arent an investment account, they're to assist first home buyers with saving for a deposit. if u can save $300000, you dnt need government assistance. the cap is so that the government can provide the service, remove the caps and it defeats the purpose of the account. dunno bout anyone else, but getting an extra ~$900 per year just for saving works for me.

bbdd	\| \| 2011-05-06 00:22:09

"You can put in way more than 5500, you still get all the interest, just not the government contribution"

Whats the point of putting in over $5500 when you dont get the gov contributions defeats the purpose.

Anonymous

| | 2011-05-06 09:26:23

No it doesn't. The point is to save. I don't see what the problem is. If you're saving, you're getting the rewards of this system. The more money you have in one account, the more interest you're going to get, the closer you will be to buying the house. It's not rocket science, you want to buy a house... you save. Any money you get from the Government is a bonus.

anonymous - saving for buying a house

| | 2011-05-10 11:18:56

-The point is helping for saving but Don't forget though this saving is to buy a house. Not to let money stuck in super annuation or any other things.

-I think most of people sees 4 years restriction is ridiculous.There is conflicting effect with this restrictin in this scheme.
May be becasue there was conflicting interest in this scheme as this was done by Government+Banks.

Josh - Changes in Circumstances

| | 2011-05-10 17:45:40

I originally started my FHSA when i started my Uni Course which was due to last 4 years so saw the FHSA to be perfect for my situation. However since then I have left Uni to work in the Mining Industry, due to this change I am now in a position to purchase my First Home but have money tangled in the FHSA. Thus this is a much needed change, four years is a long time and you have no idea what is going to happen in the future thus this should for sure be passed through.

Tuncay

| | 2011-05-10 19:24:02

we have been shafted, this FHSA is no longer a priority at all for the government

Scott

| | 2011-05-15 08:54:13

It looks like the bill that these changes are in has almost passed through parliament.

See the Following link.

http://tiny.cc/q3cxv

Copy and paste the above address into your browser.

Matt - Question

| | 2011-05-12 11:03:08

I opened an account June 30 2010, therefore the money is available to me July 1 2012.. Assuming these changes pass soon, if i buy a house in December 2011, can this money be tranfered into the mortgage in December or will it not be until July 2012???

Steve - Answer

| | 2011-05-12 18:22:28

You won't be able to transfer it until July 2012.

The four year waiting period will still apply, but if you buy a home you will no longer be able to make contributions to the account.

You will count as making a contribution each year, so on the 1st of July 2012 the account will count has having had four years of contributions, close, and the money will be transferred to your mortgage.

It's to stop people from using the account to boost their deposits.

Colin

| | 2011-05-13 17:07:51

The legislation has now passed both houses and only awaits royal assent. Thanks to Scott - see his link on 11/5/11 at 1154 above

Lok	\| \| 2011-05-15 12:21:15

So in other words, what the regulators have acheived is to look at the problems raised by those of us whom initially deposited into the system only to find the inflexibility of the four year wait, realised we were correct and said yes we agree with you, but too bad, we are not making this retrospective even though you have forced the change in policy. Feels nice to be treated like an idiot, would you agree? I certainly wont be depositing any more funds into this scheme on the principal of contempt for those who joined early.

Amanda

| | 2011-05-15 14:02:46

I can't believe this new legislation is still awaiting royal assent!!

Personally, I have withdrawn my money from my FHSA and moved the funds into my superannuation account after purchasing a house in November 2010.

When it came time to move the money, the ATO and my Bank (Commbank) had no idea on the proper legislation, rules and requirements. I had cheques being sent to the wrong place, phone calls from the ATO and when the money finally transferred into my superannuation account the transaction appears on my statement as "spousal contribution" which is insane as I am single and this money came from my FHSA.

Clearly anyone who has been involved in this FHSA scheme knows how much of a headache it is... so a warning to all... it doesn't get any easier once you close the account!

The government should be ashamed of how this has played out and they should be falling over themselves to get this new legislation signed and approved TODAY!

Deb	\| \| 2011-05-15 20:59:42

This is fantastic news! This will really help me and my partner! When will we know that it has been finalised?

Ashley - Question

| | 2011-05-16 09:27:10

I took out a FHSA in November 2008 and have deposited over 12,000 into the account. Last year in Dec 2010 I purchased my first home as I got the property for a good price. My question is do I get to use that money towards my mortgage? Or do I have to put it into Super? The new rules say that it only applies to houses purchased after the legislation has royal assent. I think that if this is the case it is unfair for people who took out the FHSA when it was first introduced.

Patricia

| | 2011-05-18 19:01:02

Royal assent HAS NOT BEEN GIVEn-13 months after this was announced in the 2010 budget-If private business operated like this, it would go to the wall in no time!!

2010 Budget Changes - Have Your Say!