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.