New way to save for home

Press, Volume CXIII, Issue 33252, 15 June 1973, Page 1

New way to save for home

A new form of savings account to assist persons saving for a first home and only available to those who have not previously owned a house or flat was announced in the Budget. The home ownership accounts will be available from October 1 at the Post Office Savings Bank, and trustee savings banks are being invited to take part in the scheme. The accounts will earn

interest of 3 per cent. Providing the savings are held for at least three years and, on withdrawal, applied in full towards the purchase or building of a first "house or flat for owner-occupancy, the saver will be entitled to: A tax concession of 25 per cent of the amount deposited will be paid into the account by the Commissioner of Inland Revenue when the saver obtains his property. A mortgage interest-rate subsidy related to the amount and duration of saving.

The maximum saving eligible for the benefit will be limited to $lOOO a year, although a man and woman who save independently under the scheme may aggregate their savings and benefits if they acquire a joint home. Holders of the accounts with the P. 0.5.8. will be given preference in the allocation of mortgages by the State Advances Corporation. “I believe the benefits available under this scheme will greatly assist people on lower and middle incomes to

acquire a home,” the Min-| ister of Finance (Mri Rowling) said. As an example, he said that a person able to save $5OO a year would have a capital sum, including the tax concession, of about $3359 at the end of five years. This could be used as a deposit on a home. In addition he would be entitled to an interest-rate subsidy which would reduce his mortgage interest payments by up to 5187.50 a year for the first five years of his mortgage. The Minister said that more details would be announced today.