update on first home buyers

A changing picture of first home buyers

There’s been quite a lot of talk recently about the First Home Loan Deposit Scheme, the Federal Government’s new program designed to assist first home buyers who have not been able to save the optimum 20% deposit.

As long as the applicant has a 5% deposit or more, the government acts as a form of guarantor for the remainder of the deposit, meaning borrowers don’t have to pay for expensive lenders’ mortgage insurance.

The launch of the First Home Loan Deposit Scheme on January 1st this year has provided some interesting data on first home buyers in Australia. Initial figures from the National Housing Finance and Investment Corporation, the government body administering the scheme, have provided a statistical picture of the applicants.

Apparently, out of the first 3000 applicants:

  • 25% were people aged 35 or older;
  • 60% were single applicants;
  • The average income for a single applicant is around $68,000; and
  • The average combined income for couples is around $108,000.

The income limit for applicants under this scheme is $125,000 for singles and $200,000 for couples.

Another interesting fact that many people may not have realised is that so far only two of the ‘Big 4 Banks’ are offering loans under the scheme. The Commonwealth Bank and the National Australia Bank. However, a further 25 smaller lenders are expected to begin offering loans under the scheme from February 1st.

Perhaps the most important number to emerge from these figures, particularly if you are keen to apply for the assistance yourself, is that time is clearly going to be an issue. With more than 3,000 applications already lodged, and a limit of 10,000 loans available each year under the scheme, buyers will want to get moving.

Of course, if you need any assistance in finding the right property at the right price, there is no substitute for experienced advice and assistance. So feel free to give one of the team at Ian Reid Buyer Advocates a call on 1300 400 400. You’ll also find lots of helpful tips on the property market in our free booklet, “Fatal Real Estate Traps Exposed”.