First home buyers want the Grant back for established homes

December 01, 2015
Gayle Roberts

First home buyers want Govt grants brought back for those purchasing an established property and the Govt needs to introduce a new incentive for first home buyers.  With property prices rising steadily across most markets, a lot of first time buyers are finding themselves priced out of the market and need more savings than previously due to recent APRA changes introduced by the Banks. 

Saving for a home for a first home buyer is double (or triple) if spending a year saving for a joint overseas holiday.  Always recommended to start off small by having an automatic deduction from your salary to a high interest online account separate to the account where salaries are deposited. Then when comfortable with the “new norm” keep increasing the amount that is automatically deducted.  For instance if $500 a fortnight is deducted, and then this becomes “comfortable” increase to $1,000 a fortnight. When $1,000 is “comfortable” increase to $2,000 a fortnight, etc.  And reward yourself at specific milestones, ie $10,000 savings; $20,000 etc (sometimes a dinner out, movies or even a nice wine to celebrate the achieve process).

Many potential first home buyers want the Govt to reintroduce a grant for those buying an established property, while others want stamp duty removed for first time buyers.  In Victoria, there is a 50% first home buyer concession for property purchases with a threshold of $600,000.  However, most of property purchases are now over $600,000 which is the reason many first home buyers are asking the Govt to reintroduce the Grant up to $750,000 threshold as previously granted.  While the various states currently have first home buyer grants in place for those who purchase a newly built property, nothing is given (except the 50% concession in Victoria) for those buying established properties (approx. 80% of all first time buyers).

A recent survey by Mortgage Choice showed 80% of respondents believe property is unaffordable and that dwelling valued have climbed considerably in the last year yet wages have not increased.

For those who have already purchased and have a mortgage, it is always prudent to make extra lump sum payments directly to the loan via the internet ie. extra $500 a month on the 1st of each month. This will build up a “surplus” in a redraw facility linked to the home loan.  Not only doing this pay off your home loan faster over time, but is a buffer should variable rates increase, but is also a discipline for “a rainy day” - should like take a twist.

Posted in: First home buyers

Contact us today.

Additional Comments? * :