ACCORDING to the Australian Bureau of Statistics, the percentage of first home buyers entering the Australian market has fluctuated significantly over the last 30 years.
Between 1992 and 2002, the average percentage of dwellings financed for first home buyers sat comfortably at around 20-25 percent. Since then, this figure dropped markedly, often as low as 12 percent, and only managing to frequently top that 20 percent figure again around the 2008-09 financial crisis.
Since January 2012, the percentage has remained below 20 percent, reaching as low as 13 percent in September 2016. In recent years, however, that number has shown growth, with the average percentage dwellings financed for first home buyers, rising to around 18.3 percent in November 2018.
In an effort to continue this upward trend, the government has recently introduced legislation to implement the First Home Loan Deposit Scheme and the National Housing Finance and Investment Corporation’s (NHFIC) new research function to support first home buyers.
The scheme will help first home buyers enter the property market sooner by providing a guarantee that will allow eligible first home buyers on low and middle incomes to purchase a home with a deposit of as little as 5 percent, supporting 10,000 first home buyers each financial year.
In a statement regarding the new scheme, the government recognises that saving for a deposit has become a more significant barrier to entering the housing market than the ability to service a home loan.
Applicants will be subject to eligibility criteria, including having taxable incomes up to $125,000 per annum for singles and up to $200,000 per annum for couples. The scheme will apply to owner-occupied loans on a principal and interest basis and will be subject to regional price gaps.
The legislation also establishes a new housing research function within NHFIC. As part of its new function, NHFIC will examine housing demand, supply and affordability in Australia, complementing existing housing-related research.
The scheme complements other government initiatives to reduce pressure on housing affordability in Australia and support local communities.
