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The Ultimate Guide to DHOAS

The Ultimate Guide to DHOAS

By far the number one ADF Housing Entitlements we get asked most about is DHOAS. But that means there are also a lot of misconceptions out there regarding it.

What is DHOAS?

The Defence Home Ownership Assistance Scheme is a subsidy and home loan scheme available for ADF members. It’s designed to achieve two aims within the ADF - help you and your family achieve home ownership; and to improve recruitment/retention.

Basically, DHOAS subsidises your home loan, for an amount and period of time, based on how long you serve. Keep in mind, this is not to do with investment properties. It's all about your own home only!

Property Coach Dane & Property Specialist Dave break down DHOAS in detail:

How Much DHOAS Am I Entitled to?

How much you’re entitled to is calculated as a percentage on the The Australian Average House Price (AHP) and split into three subsidy tiers based on service length.

● Tier 1 is 40% of the AHP
● Tier 2 is 60% of the AHP
● Tier 3 is 80% of the AHP – maximum benefit!

As at 1 July 2021, the AHP is $777,343 - meaning it contributes a monthly amount between $192 and $385 to your loan.

Head to the Subsidy Amounts Calculator to calculate your DHOAS subsidy payment estimate.

Robbie runs through the most relevant and up to date information regarding the subsidy and the tiers.

What are the DHOAS Deadlines?

Understanding the deadlines and lifespan of your entitlements is crucial to making the most of them and securing your financial future.

The amount you are entitled to receive varies, based on the three-tier system and very importantly, it can be used for five years after discharge. Here’s a little more about why we sometimes recommend waiting to pull the trigger.

Read More: DHOAS Deadlines

DHOAS Interest Rate Myths

A really common misconception out there is that you have to pay more for a DHOAS rate when you get your home loan than you would with a regular rate. We’re here to break down the common misconceptions about DHOAS loans and interest rates. 

Reason 1. There's only three lenders that can provide you with a DHOAS loan

Compare that to the rest of the market where there's dozens and dozens and dozens of lenders.

When you've only got three lenders available, it reduces the amount of competition that's in the market, whereas if you've got dozens of lenders it increases the competition. When you've got increased competition, it lowers the rates, because there's more competition for your business out there.

Reason 2. DHOAS Lenders Pay Back

Another reason for a slightly higher interest rate than you see with normal lenders is because DHOAS lenders actually have to pay a commission back to the government.

Reason 3. Fixed VS Variable Rates

Variable is a negotiable rate - It doesn't move (The RBA can change that and if the bank follows through)

If you're fixed, you're going to get locked in (You're not going to have your offset account. You're not going to get your rater)

So you really have to weigh up where it is that you want to be with your financing debt and what's the most suitable structure for yourself.

If you’re eligible, taking advantage of DHOAS is one of the best things you can do. Talk to our property coaches today and learn how you can make the most of your ADF Housing Entitlements.


Disclaimer: This information is not to be taken as legal or financial advice, please see the disclaimer page for full information.