You are currently viewing Embracing Dreams: Australians’ homebuying aspirations soar as they escape the rental squeeze

Embracing Dreams: Australians’ homebuying aspirations soar as they escape the rental squeeze

Amidst the relentless rise in living expenses and a series of interest rate hikes, fascinatingly, homebuying intentions have surged, as per the most recent data. It begs the question: why is the allure of the great Australian dream stronger than ever? Together, let’s unravel the mystery behind this trend and discover how you can turn your cherished dream into a reality.

Amid a series of interest rate increases, recent data reveals that homeownership has once again become a top priority for many Australians, leading to a rise in the number of prospective homebuyers.

According to the Household Spending Intentions Index by Commonwealth Bank, homebuying intentions saw a robust 14.4% increase in May, rebounding after a dip in April.

Additionally, there was a consecutive growth in new home sales across Australia during May, indicating a strong appetite for property.

Factors Fueling the Property Craze

Across major cities and significant regional areas, rental prices have soared, and vacancy rates have hit historic lows.

In April, rental vacancies dropped to an all-time low of 1.1%, with the median unit rental price being only $39 cheaper per week than renting a house.

The influx of overseas migrants has also intensified the competition in the rental market, with a staggering 124% surge in rental inquiries from a single overseas country in the March quarter.

Naturally, many individuals are eager to transition from renting to homeownership, but with rising interest rates and inflation, saving for a deposit has become increasingly challenging for most Australians.

Strategies and Incentives to Lighten the Load

To alleviate the financial burden, several government schemes and grants have been designed to assist aspiring homeowners in entering the property market, and the best part is that they can be utilized simultaneously, resulting in substantial savings.

The federal government, through the National Housing Finance and Investment Corporation, offers three low deposit options with no lenders mortgage insurance (LMI) for eligible first-home buyers, regional first-home buyers, and single parents.

The First Home Guarantee and Regional First Home Guarantee enable eligible buyers to purchase a home with just a 5% deposit, while the Family Home Guarantee assists eligible single parents with a 2% deposit.

By avoiding LMI payments, homebuyers can save anywhere from $4,000 to $35,000, significantly expediting their goal of owning their first home by four to five years.

Another significant expense when buying a home is stamp duty, which can be particularly burdensome. Fortunately, many state governments provide stamp duty concessions for first-home buyers. For instance, South Australia recently announced the elimination of this tax for first-home buyers on new homes valued up to $650,000.

Similarly, Victoria, New South Wales, Queensland, Western Australia, Tasmania, the ACT, and the Northern Territory also offer stamp duty concessions to either reduce or eliminate this cost for eligible buyers.

Most state governments additionally offer first homeowner grants to further support aspiring homeowners. Grants ranging from $10,000 to $30,000 are available, depending on the state and meeting other eligibility criteria.  Contact us to find out what’s on offer in your state

Reach out to find out more

It is important to note that some schemes, such as the federal government’s first home guarantee, have limited availability and are in high demand. Therefore, it is advisable to act swiftly to secure a spot.

If you are keen on leaving renting behind and are eager to embark on your homeownership journey, do not hesitate to reach out to us.

Our team will assist you in determining your borrowing capacity, exploring loan options, and assessing your eligibility for various schemes to help you achieve your homeownership dream.

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Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

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