Housing price increases, despite record low interest rates, are making it difficult for first home buyers to break into the market. But, there are regions in Australia that are more affordable than others.
Where are First Home BuyersPurchasing?
According to the Australian Bureau of Statistics (ABS) the highest number of first home buyer loans written in February 2015 came from W.A where 1 in 5 home loans were first home buyer. QLD and VIC followed closely with each state having close to 17 percent of all their home loans being first home buyer based.
N.S.W recorded the lowest number of first home buyers with just 4 percent. But, given that the median price of a home in Sydney has jumped to $680,000 this is hardly surprising.
What Prevents More First Home Buyers from Buying?
The biggest hurdle for the first home buyer to overcome is the saving of a deposit. Family can help out by lending new home buyers money to add to their savings for a deposit or by offering them accommodation while they save for a deposit.
Of course, first home buyers are also competing with investors for property that is at the bottom end of the market, as these typically make for excellent rental properties. This means that property prices are being pushed up.
What are the Latest Recommendations for First Home Buyers?
Treasurer Joe Hockey has suggested that first home buyers should be allowed to access their superannuation to help them break into the property market. But, many economists predict that this could increase housing affordability.
Some state governments are recommending that new first home buyer incentive programs be introduced. This may help to raise buying numbers.
Housing experts recommended that first home buyers without a sizeable deposit are better off renting than buying, until they save more. A 10 to 20 percent deposit is ideal.
Are you thinking about buying your first home? Then contact an eChoice consultant Today and discuss your options.
Written by eChoice