First Home Guarantee Eligibility If You’ve Owned Property Overseas

By Andrew Paterson

If you’ve owned property overseas and you’re looking at using the First Home Guarantee to buy your first home in Australia, you might assume that history counts against you.

That assumption is understandable, but the scheme only assesses Australian property ownership. Whether you previously owned in the UK, India, New Zealand, the Middle East or anywhere else, that alone doesn’t affect your eligibility.

State-based grants work differently though, and the distinction catches people who assume all schemes follow the same rules.

How the ownership rule works

The First Home Guarantee defines a first home buyer as someone who hasn’t owned property in Australia in the past 10 years. The definition of “property” is broad. It includes:

• Houses, units and townhouses
• Vacant land
• Commercial property
• Being on a parent’s title
• Inheriting Australian property even briefly

But it’s specifically limited to Australian property. Someone who owned a house in London for 15 years, sold it, moved to Australia and rented in Geelong qualifies as a first home buyer under this scheme.

The same applies regardless of what you owned overseas, whether that was an apartment in Mumbai, a villa in Dubai or a family home in Auckland. None of it is considered under the scheme’s eligibility rules.

Where state grants differ

Qualifying for the First Home Guarantee doesn’t automatically mean you qualify for everything else. Victoria’s First Home Owner Grant uses a different definition of “first home buyer” that includes worldwide property ownership.

You’re ineligible for the FHOG if you or your partner have owned and occupied residential property anywhere in the world after 1 July 2000. So the overseas property that doesn’t matter for the First Home Guarantee may matter for the FHOG.

In practice, someone who owned and lived in a home in the UK for five years before migrating to Australia would qualify for the First Home Guarantee but would not receive the $10,000 FHOG.

What matters for the FHOG is whether you lived in the property, not just whether you owned it. If you owned an investment property overseas but never occupied it as your residence, you may still qualify for both schemes.

Victoria’s stamp duty concessions follow similar worldwide ownership rules to the FHOG, so if you’re excluded from one, you’re likely excluded from the other.

Citizenship and residency requirements

Overseas property ownership doesn’t affect your eligibility, but your residency status does. Buyers who’ve owned property overseas are often relatively recent arrivals to Australia, so the citizenship requirement is relevant here.

You need to be an Australian citizen or permanent resident to use the First Home Guarantee. Temporary visa holders aren’t eligible, even if they meet every other criterion.

For couples, both applicants must hold citizenship or permanent residency at the time the home loan settles.

If one partner is an Australian citizen and the other holds a temporary or bridging visa, the citizen can apply as a sole applicant. That means qualifying on one income with one name on the loan, which significantly affects borrowing power.

Couples where one partner owned overseas

If one partner owned property overseas and neither of you has owned property in Australia in the past 10 years, you can apply jointly. The overseas ownership doesn’t create a problem for either applicant.

The more common complication is when one partner briefly held Australian property, even years ago in a previous relationship. In that case, the alternative is the non-owner applying alone, which reduces borrowing power significantly since the lender can only assess one income.

Our borrowing power calculator shows how that affects your numbers.

Documentation and lender expectations

You’ll need to complete a Commonwealth statutory declaration confirming you haven’t owned Australian property in the past 10 years. That declaration needs to be accurate, as making a false statement on a Commonwealth statutory declaration is a criminal offence.

Beyond the declaration, lenders may ask for additional information depending on your background:

• Overseas property explanation. Some lenders ask about overseas property as part of their own credit assessment. If you lived or earned income overseas recently, your lender may want a short written explanation confirming where the property was located, when you owned it and that it was not in Australia.
• Australian employment and tax history. For recent arrivals, lenders typically want to see local employment history and Australian tax returns before they’ll assess your borrowing capacity.
• ATO Notice of Assessment. If you haven’t yet lodged an Australian tax return or received an ATO Notice of Assessment, there may be delays in getting the guarantee issued, even if your scheme eligibility is straightforward.

Eligibility for the scheme and approval from a lender are separate assessments.

Owning property overseas doesn’t affect your scheme eligibility, but it can still influence how lenders view your income history, foreign tax returns or recent migration status.

If you’re early in the process, our overview of first home buyer loans explains how lenders assess your situation as a whole.

Want to talk it through?

For more on how the First Home Guarantee works alongside other benefits, see our complete guide to Geelong grants and schemes.

A 15-minute chat will tell you where you stand. Whether you qualify for the First Home Guarantee, the FHOG or both, and what the numbers look like for the areas you’re considering.

No cost, no pressure, no paperwork until you’re ready.

Schedule a free chat or call us on (03) 5222 7453.