Government Support and Family Guarantees Helping More First Home Buyers Enter the Market

The Real Estate Market Sees an Increase in First Home Buyers Utilizing Government Assistance

As the real estate market continues to fluctuate, a larger portion of first home buyers are accessing the marketplace with the help of government policies and family support, according to industry experts.

Ray White chief economist Nerida Conisbee highlighted the impact of government shared equity schemes, including the federal First Home Owner Grant and state-based programs, in assisting first home buyers in entering the market. This has led to an uptick in first home buyer activity towards the end of last year.

Additionally, mortgage broking firm Finspo’s chief lending officer Nathan Taddeo noted an increase in first home buyers using government schemes or family guarantees, as well as purchasing with a small deposit and opting for lenders mortgage insurance. Taddeo observed a trend of first home buyers borrowing over 80 or 90 percent of the property’s value.

Experts such as Tim Lawless emphasized the potential long-term financial benefits for homeowners who secured a mortgage with a low deposit, despite facing short-term financial challenges. With rising interest rates and cost of living pressures, homeowners who bought during the pandemic may have faced initial difficulties but are likely better off in the long run.

While there are risks associated with low-deposit purchases, experts believe that the potential benefits outweigh them. As interest rates are expected to decrease and inflation to moderate, the financial pressure on homeowners should ease, making it a risk worth taking for those looking to enter the market.

Overall, the accessibility of government schemes and family support is playing a crucial role in allowing more first home buyers to make their mark in the real estate market.