Say I buy a unit for $500k with government backed 25% deposit $125k. I would have a $375k mortgage. What happens if 5 years later, the market has cooled and the unit drops in market value to $400k and I happen to have to sell? Who wears the negative equity? The government will share in capital gains, but what about capital losses? Is it only the homeowner who wears the losses?
Hello, the Victorian Government does not receive interest on its investment but will share in any capital gains or losses proportionate to its interest in the property. If you would like further information, please contact Blaz Rakas on 0478 435 135 or the following link has FAQ's and case studies that may help www.sro.vic.gov.au/homebuyer
Hello, the government is essentially a 25% partner in the property, so they are entitled to their 25% stake. Any interest charged would be calculated on your loan, and no interest would be charged on the government's 25% equity stake. Capital gains tax would be applicable as the scheme is only available on owner-occupier purchases (capital gains tax is not applicable to your principal place of residence). If you would like further information, please contact Blaz Rakas on 0478 435 135 or have a look at the following site www.sro.vic.gov.au/homebuyer
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Say I buy a unit for $500k with government backed 25% deposit $125k. I would have a $375k mortgage.
What happens if 5 years later, the market has cooled and the unit drops in market value to $400k and I happen to have to sell? Who wears the negative equity? The government will share in capital gains, but what about capital losses? Is it only the homeowner who wears the losses?
Hello, the Victorian Government does not receive interest on its investment but will share in any capital gains or losses proportionate to its interest in the property. If you would like further information, please contact Blaz Rakas on 0478 435 135 or the following link has FAQ's and case studies that may help www.sro.vic.gov.au/homebuyer
instead of paying back to govt by capital gains, can I just pay them back their 25% (without interest)??
Hello, the government is essentially a 25% partner in the property, so they are entitled to their 25% stake. Any interest charged would be calculated on your loan, and no interest would be charged on the government's 25% equity stake. Capital gains tax would be applicable as the scheme is only available on owner-occupier purchases (capital gains tax is not applicable to your principal place of residence). If you would like further information, please contact Blaz Rakas on 0478 435 135 or have a look at the following site www.sro.vic.gov.au/homebuyer