January 11, 2021
The coronavirus pandemic has accelerated the desire for homeownership in young people, according to Mortgage Choice research. Nearly 45% of survey respondents are more likely to want to purchase a home now, with a similar number feeling optimistic about achieving their homeownership goals.
While property affordability remains a significant concern, the COVID-19 crisis has caused a shift in priorities. The research found that saving money is now rated as the highest priority for young people. In order to save and buy sooner, 60.2% are reducing their spending, 58.5% are adding more to their saving accounts, and 43.4% are applying for government grants for first home buyers.
Susan Mitchell, Chief Executive Officer, Mortgage Choice, said, “COVID-19 has given us all a wake-up call, and for young people, this is to focus their attention on their financial goals.”
“Despite the challenges of getting into the property market, young people are not giving up on the great Australian dream. In times of uncertainty, it is human nature to want stability, and this is what investing in property can provide.”
“The fact that first home buyers can now access the most competitive home loan rates on record and unprecedented levels of government support such as grants and schemes provides compelling incentives to act on property ownership dreams.”
A majority of respondents (85.9%) have changed saving and spending behaviour since the pandemic, with 7 in 10 intending to maintain these habits.
“I would encourage homebuyers who are navigating their way into first-time property purchase to enlist the help of an experienced mortgage broker to help them put their best foot forward. A mortgage broker will help you understand your borrowing power and make sense of the often overwhelming process of applying for a home loan,” said Ms Mitchell.
Many young Australians find buying a home to be a complicated undertaking. Almost 1 in 3 (32.4%) first home buyers have minimal confidence in understanding and choosing home loan features, while 1 in 10 are not confident at all.
The research found mortgage brokers are the most likely professional to be relied on in the home buying process. The key benefits respondents gave for seeking professional advice were to reduce mortgage-related costs and financial worry, as well as to achieve greater control and understanding.
“Mortgage brokers play a critical role in educating first home buyers and giving them the confidence to enter the market. Brokers make it easier for first-time borrowers to understand the steps in their home loan journey, compare loan options and make informed decisions about which product best suits their goals and needs,” concluded Ms Mitchell.
About the research
The Mortgage Choice research is based on research commissioned by Mortgage Choice and conducted by CoreData between 14 and 27 October 2020. The research was conducted via a quantitative online survey, gathering a total of 1,023 responses from Australians across the country aged between 21 and 60 years old who are either a ‘First home buyer’ (494 respondents) or a ‘Homeowner/Investor’ (529 respondents).