During March, first home buyer confidence hit a high with 66 percent of first home buyers believing that now was the right time to buy a home. Even though accessing the market is still an issue for first home buyers, more first home buyers were more relaxed about their ability to service their home loan.
First Home Buyer Concerns
High property prices was the greatest barrier to first home ownership. This was closely followed by saving a deposit.
While the average deposit has remained relatively stable since 2009, the time to raise the deposit has decreased. This is due to the fact that first home buyers are using resources, other than savings, to raise enough for a deposit.
Personal debt and monetary gifts from family were the most frequently used means to raise enough money for a deposit. Other methods included selling goods, such as cars and motorbikes or working two jobs.
Low Deposit Home Loans
While saving a deposit is the greatest obstacle for first home buyers to overcome, low deposit home loans can assist them to break into the market faster. However, first home buyers need to be aware that low deposit home loans can attract lenders mortgage insurance (LMI).
LMI protects the lender against loan default and can add thousands to the cost of a home loan. Therefore before taking out a low deposit home loan, first home buyers need to ask about fees and calculate costs.
Where is the Greatest First Home Buyer Confidence Found?
According to survey data, Western Australia recorded the highest first home buyer confidence, and Victoria recorded the lowest. In fact, Victorian first home buyer confidence was the only to fall since September 2014. All other states have recorded an increase in first home buyer confidence.
Are you seeking to buy your first home? Then discuss your options with eChoice and find the right home loan.
Written by eChoice