Build or Buy? How First Home Buyers Can Save Nearly $50,000

Buying your first home is one of the biggest financial decisions you’ll ever make. The good news is that if you’re an eligible first home buyer in Victoria Australia, there are government incentives that can save you tens of thousands of dollars — but the rules differ depending on whether you’re buying an established property or building a new home.

Let’s break it down.

Buying an Established Home

If you’re purchasing an established property as a first home buyer, you can spend up to $600,000 and pay no stamp duty.

However, if you purchase an established home above this threshold, normal stamp duty rates apply. For example:

• Buying an established home for $749,000 means you would need to pay around $39,743 in stamp duty.

That’s a significant extra cost to factor into your budget.

Building a New Home

Building offers additional advantages for first home buyers.

If you’re building:

• You can spend up to $750,000 in total and pay no stamp duty. You’ll also receive the $10,000 First Home Owner Grant.

  
  

• As long as the land value is under $600,000. 

  
  

This means you can unlock far greater value compared to buying an established property.

Real Example: Building vs Buying Established

Let’s compare a $749,000 purchase price.

• Established Home ($749,000)

  • Stamp duty: $39,743

  • No grant

  • Total additional cost: $39,743

    
    

• New Build ($749,000)

  • Stamp duty: $0

  • First Home Owner Grant: +$10,000

  • Total advantage: $49,743

    
    

That’s nearly $50,000 in savings simply by choosing to build rather than buy established.

Why This Matters for First Home Buyers

These incentives effectively extend your buying power, giving you access to higher-value homes while keeping your budget under control. By building, you not only get a brand-new home tailored to your needs, but you also avoid a major upfront cost and receive financial support through the grant.

Final Thoughts

If you’re a first home buyer weighing up your options, it pays to consider the difference between buying established and building new. The combination of stamp duty savings and The First Home Owner Grant can make building a far more affordable pathway to home ownership — potentially saving you up to $49,743.