Local first home buyers will be able to enter the property market sooner after the Federal Government yesterday passed legislation to create the First Home Loan Deposit Scheme.
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The scheme will enable eligible people the opportunity to buy their first home with a deposit of five per cent.
Federal Member for Cowper Pat Conaghan said this new scheme would make homes more affordable for people on low and middle incomes and greatly help young people in the region.
"Our Government has listened to the community and we have acted to reduce one of the largest impediments some people face when trying to enter the property market for the first time, the 20 per cent deposit required by most mortgage lenders," he said.
"In our area in today's property market, a 20 per cent deposit can range from $50,000 to $100,000 or more. This can take young people on low and middle incomes ten years or more to save up, putting off and in some cases extinguishing the dream of home ownership for many.
"We recognised this was not good enough and by creating the First Home Loan Deposit Scheme we have made home ownership more achievable for 10,000 people each financial year starting from 2020."
Applicants for the First Home Loan Deposit Scheme will be subject to eligibility criteria, including having taxable incomes up to $125,000 per annum for singles and up to $200,000 per annum for couples. The Scheme will apply to owner-occupied loans on a principal and interest basis, and will be subject to regional price caps.
The legislation also establishes a new housing research function that will allow the new National Housing Finance and Investment Corporation to examine housing demand and supply and affordability in Australia.
The scheme complements other government initiatives to reduce pressure on housing affordability in Australia and support local communities which have included:
The First Home Super Saver Scheme which helps Australians build a deposit for a first home inside their superannuation fund by making voluntary contributions; and investing $1 billion in local infrastructure to unlock new housing supply, in partnership with local councils through the National Housing Infrastructure Facility.
In the past year, more than 110,000 Australians bought their first home - the highest level since 2009. The scheme is expected to commence from January 1, 2020.
Monitor https://www.nhfic.gov.au/fhlds for more information.
