Blog - First Home Buyer

Will the future property market provide a win for Australian first home
buyers?

Home values have been soaring in recent months, but with value growth starting to settle down,
first home buyers are well-placed to get into a place of their own sooner.
The current property market spells ‘opportunity’ for first home buyers, but some expert help landing
your first home loan is more important than ever.
Value buying still possible
After a long stretch of rapidly rising values, CoreLogic says the property market is seeing a slowdown
in price growth 1 . And there are still opportunities for value buying.
Apartments a lot more affordable than houses.  Across the state capitals, house values rose 8.6% in
the first four months of 2021 – that’s double the pace of apartment price growth (4.3%) 2 . So, it’s still
possible to find an affordable home in the apartment market.
This is all welcome news for first home buyers, especially as it comes at a time when there is plenty
of support available to take that all-important first step into the market.
Let’s add up the benefits available.
Home loans rates below 2%
Home loan interest rates are still at historic lows – better still, the Reserve Bank has made it clear
that rates are unlikely to rise before 2024 3 . That’s very reassuring for anyone buying a home –
especially first home buyers.
With rates on our lending panel starting from 1.79% (comparison rate 3.36%) 4 , it’s fair to say home
loan interest rates are more affordable than ever before.
Talk to your Mortgage Choice broker about the best deal on a loan that matches your needs. You
could be surprised how low the rate is!
First home loan deposit scheme – buy with just 5% deposit
The FHLDS helps eligible first home buyers build or purchase a new home with a deposit as low as
5%, without the need for lenders mortgage insurance.

1 https://www.corelogic.com.au/news/home-values-continue-rise-pace-growth-loses-steam-april
2 https://www.corelogic.com.au/news/home-values-continue-rise-pace-growth-loses-steam-april
3 https://www.rba.gov.au/media-releases/2021/mr-21-04.html
4 https://www.mortgagechoice.com.au/

That’s more than a massive saving – the FHLDS could let you buy a $500,000 home with a deposit of
just $25,000.
The FHLDS can be used to build or buy a:
 newly-constructed home
 off-the-plan home
 house and land package
 land and a separate contract to build a new home.
Not every bank offers the FHLDS, so it’s important to speak with your Mortgage Choice broker to
know if you’re eligible, and focus on those lenders that are part of the Scheme.
First Home Owner Grant – still available
It’s been around for a while, so it’s easy to overlook the value of the First Home Owner Grant (FHOG)
as part of your home buying process. But it can be worth big bucks. In regional Victoria for instance,
first home buyers can claim a $20,000 FHOG 5 .
Don’t forget, if you’re eligible, the FHOG can be used as part of your deposit.
Check out our free FHOG guide to know what the FHOG is worth in your area, or talk to your
Mortgage Choice broker for tailored advice.
So, where are prices heading?
Will the future property market provide a win for Australian first home buyers? We believe so.
CoreLogic is expecting housing values to continue rising throughout 2021 and into 2022 6 . That’s
definitely an incentive to buy now before prices rise further.
What about the longer term? History has repeatedly shown that property has a strong track record
of long term price growth, and the expression, ‘the only time your home seems expensive is when
you buy it’ certainly rings true.
As a guide, five years ago the median Sydney home value was $730,000 7 . Today that figure is
$950,457. In fact, the past five years have seen capital city home values nationally rise from
$550,000 to $705,375.
As this period includes the disruption and uncertainty of the COVID pandemic, it’s hard to see home
values going backwards any time soon.
Clearing up the ‘what if’s

5 https://www.sro.vic.gov.au/first-home-owner
6 https://www.corelogic.com.au/sites/default/files/2021-05/210503-CoreLogic-HVI-May21-FINAL.pdf
7 CoreLogic RP Data Hedonic Home Value Index, April 2016

Buying a home can seem like a complicated process. Your Mortgage Choice broker makes it easy,
letting you know how much financial support you’re eligible for through the First Home Owner
Grant, stamp duty concessions and the First Home Loan Deposit Scheme.
More importantly, your broker can pinpoint the loan and lender best-suited to your unique needs,
and where possible, tap into their industry experience to negotiate a better rate.
It makes speaking with your Mortgage Choice broker a sensible part of your first home buying
strategy. It’s like having an expert on your side to help make home ownership easier to achieve –
and with the right loan in place – more affordable.

If you’re thinking about buying your first home, contact us - your local Mortgage Choice broker today
to start the ball rolling.

P : 0438 444 393 
E : kristie.gould@mortgagechoice.com.au