Interest rates are currently at an all-time low following a further 0.25% cut to the cash rate by the Reserve Bank in May 2016. This suggests that finance product quality and affordability should not be too concerning for first time buyers.
In the current market there is an overwhelming amount of choice when it comes to buying or building a home, and there are unique products available and government incentives in place to further help and encourage young Australians to buy property.
Whilst there has been an overall downturn in the market so far this year, house and land packages are one particular segment of the housing market which remains strong. According to new industry figures, 60% of first home buyers are now choosing to build. Why is this?
Firstly, first home buyers are eligible for the first home owners grant of $10,000 where an application is submitted for a contract with both a house and land purchase. In addition to this first home buyers may be exempt from paying stamp duty when they are purchasing a house and land package.
These government incentives, along with attractive first home buyer deals being offered by builders, could mean that entering the property market is not so out of reach for some young Australians.
YAY FOR WA!
Western Australia is leading the way in terms of the housing affordability. Latest finding by an Australian Investment Services company found that for the twelve months to the end of March 2016, Perth residents spent just 21.5% of their monthly income on mortgage repayments, down from 22.6% previously. Nationally, Australians spend 27.6% of their monthly income on mortgage repayments – 6.1% more than the WA average.
Latest data released by Reiwa in their March 2016 Quarterly report showed that almost half of the total property sale transactions that occured during the quarter were for less than $420,000. This shows there are affordable options available in the current market that are not so out of reach for first home buyers.
At iconic home loans we understand that the property and finance markets can be extremely daunting places for first time buyers and we strive to provide our clients with the tools, resources and knowledge that they need to make an informed decision about buying or building a new home.
If you or someone you know is looking to enter the property market and build their first home, we invite you to contact iconic home loans on 1300 663 943 or via email to email@example.com.
Our friendly finance brokers are highly experienced in helping young Australians bring their home ownership dreams to life and we are excited and ready to help you too!
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** All information taken from the following websites: Reiwa, The Australia Bureau of Statistics and the Reserve Bank of Australia. Information is current as at May 2016. Finance availability is subject to applicant satisfying lenders qualifying criteria, and all approvals are at the discretion of the lender.