AS FEATURED IN:
this training is for you if:
ADF HOUSING ENTITLEMENTS: DHOAS, HPAS & HPSEA
As we come from both a property investment and ADF background, we’re in a unique position to discuss the special ADF housing entitlements that you are eligible to receive. These are loosely grouped into two categories – ‘assistance to purchase’ (HPAS/HPSEA) and ‘assistance to repay the loan’ (DHOAS).
Home Purchase Assistance Scheme (HPAS)
As a member of the ADF, you are eligible for assistance to purchase your own home. HPAS comes in the form of a lump-sum payment of $16,949, before tax. Note that the amount you’re eligible for is affected by your share of ownership of the property (i.e. – joint ownership with a non-ADF member will see the amount halved).
To be eligible to receive an HPAS payment, you must meet the following criteria:
- You must not have received HPAS before; it is payable only once in your entire period of service.
- You must purchase a home in your current (or new) posting location.
- On the day that you sign contracts, it is expected that you will serve in the location for 12 months after the purchase. Also, this means that you will have to live in the house for the remainder of your posting tenure to that location.
- If you are MWD(U), you need to remain in that categorisation for the next 12 months.
The best part? You are eligible to receive this lump sum payment BEFORE you need to pay your deposit as you are considered to have purchased a home when you have signed either the contract to purchase or the agreement for it to be built.
Home Purchase or Sale Expenses Allowance (HPSEA)
While we are strong advocates for a ‘buy and hold’ property strategy, there are some circumstances when it is untenable to continue ownership of a property. HPSEA is an allowance for the reimbursement of reasonable costs to an ADF member when they sell a home at the time they are being posted to a new location; or if they sell in their previous posting location and buy again in the new location.
An example would be if you own a home in Sydney, then get posted to Brisbane and want to buy a new home there. You would be eligible to receive HPSEA to reimburse the sale and purchase costs, including real estate agent’s commissions, stamp duty, solicitor’s fees, mortgage costs etc. This is to compensate for the relatively high transactional costs of selling and buying. The amounts you will receive through HPSEA vary for this allowance, depending on your costs. All of this is covered in extensive detail within PACMAN.
Defence Home Ownership Assistance Scheme (DHOAS)
The Defence Home Ownership Assistance Scheme (DHOAS) is a subsidy and home loan scheme available for current and former Australian Defence Force members. It is designed to assist ADF members and their families in repaying their Defence home loan and achieve homeownership easier.
The longer you serve in the ADF, the more entitlement you accrue under DHOAS and the longer you can receive assistance.
Veterans who served on or after 1 July 2008 can access the scheme at any stage after they have left the service.
Basically, a DHOAS loan subsidises your home loan for an amount and period of time based on how long you serve. As of July 2023, it contributes a monthly amount between $492 and $985 to your loan. Not bad for just being an eligible ADF member, right? The amount you are entitled to receive varies based on a three-tier system – as seen in the table below.
Subsidy Tiers for 2023-24
|Subsidy Tier||Minimum Permanent Service||Minimum Reserve Service||Subsidised Loan Amount||Maximum Monthly Subsidy*|
Up to $510
Up to $765
Up to $1020
*Estimated monthly subsidy values based on the July 2023 median interest rate. These monthly subsidy values fluctuate based on changes in the median interest rate.
As of 1 Jul 2023, the AHP is $912,289 (down from $1,005,397).
You can see that you have to wait two years of service before you gain access to DHOAS. We recommend that you wait until you have done at least four to six years of service before you pull the trigger. This is for either of two reasons:
1- So you can have a higher monthly subsidy (about an extra $255 per month stays in your pocket) or;
2- So you can use four years of your service in a lump sum – very useful to top up your cash buffer after you have purchased your home.
The real kicker is the main condition of receipt – you and/or your family must occupy the home for at least 12 months and you will need to be occupying the home and holding a valid subsidy certificate before your subsidy payments will commence.
PRO TIPS TO MAXIMISE YOUR HOUSING ENTITLEMENTS
OUR UNIQUE AND SUCCESSFUL method
Incorporating his expertise in property investment alongside his experience in the ADF (including 11 years in the Special Forces), Robbie Turner founded Axon Property Group and created ‘The Commando Approach To Property’.
This is a unique method inspired by the ‘military appreciation process’ (purpose, method, end state) that guarantees the successful acquisition of property.
Check out a few of our case studies below:
veterans serving the defence community
AXON PROPERTY GROUP
Our experience within the Defence community provides us with the unique ability to provide strategic guidance and education for you to maximise your ADF housing entitlements and achieve your financial goals.
We provide end-to-end guidance and mentorship throughout the entire property acquisition process from strategy and finance through project supervision of the build.