The new Federal Budget is good news for home buyers. The First Home Super Saver and Family Home Guarantee will allow more people to enter the property market, encouraging home ownership.
The restriction of the First Home Deposit scheme to only include new or recently built homes will put minimal pressure on house prices, while boosting housing supply, a move critical to maintaining housing affordability.
Ray White Group Managing Director Dan White said the big spending budget was great news for the property industry. “Any moves to ensure that the economy is supported means that buyers will remain confident. Despite some big challenges to the Australian economy, property has been a strong performer,” Mr White said.
“High savings rates and low interest rates have been critical however big changes to the way we work and holiday have extended positive benefits more broadly across Australia.”
He believed the precision with which the First Home Super Saver and Family Home Guarantee targeted young people and single parents respectively meant that instead of causing a flood in demand, the schemes would instead simply allow those groups to bid competitively for houses.
The schemes will help these buyers groups to “bridge the deposit gap” and bring the aspiration of home ownership within reach of a broader range of Australians.
“We’ve found that when governments have tried to improve housing affordability in the past it’s unfortunately tended to lift property prices but this is the first time I can remember that a federal policy has been this targeted,’’ Mr White said.
“Home ownership is crucial to stability in life. Sooner you can get your first home the better off many people are.”
As expected, Treasurer Josh Frydenberg announced first-home buyers would be able to release up to $50,000 as part of voluntary contributions into their superannuation under the First Home Super Saver Scheme. That’s an increase from $30,000.
The First Home Loan Deposit Scheme (New Homes), rebranded as the New Home Guarantee, has an additional 10,000 places, allowing first-home buyers to build a new home or buy a newly built home on as little as five per cent deposit, with the government acting as guarantor on the loan, freeing the buyer from incurring lender’s mortgage insurance.