4 tactics for the first-time homebuyer in this high priced market

How do you feel about your prospects of getting a new home? Well, according to a survey released by Per Capita’s Centre for Equitable Housing (CEH), 24% of people feel they’ll never be an owner. 

It’s not hard to see why. Per Capita’s survey estimates that housing stress—where a household has to commit an oversized portion of their income to housing expenses—may be affecting as many as 1 in 4 Australian households. 

So, with more Aussies feeling the Australian dream slipping out of their hands, it's no wonder that more are expecting the government to step in with almost three-quarters (72%) of Per Capita’s survey respondents supporting the construction of social housing.

However, with delays of the government's Housing Affordability Future Fund in the Senate causing a deadlock in the system, and affordable housing feeling more out of reach than ever, people are also feeling pessimistic about government support. 

But don’t despair just yet! At Mozo, we believe everyone has the power to improve their financial position. So, what can everyday people do to actually build toward that first home?

Let’s consider 4 simple tactics:

1. Budget for your deposit

You’d be surprised how much we waste when we don’t structure our spending. Too many times when shopping you can think “why not?” or buy things on a whim. You won’t be perfect with it, nobody is, but it’ll plug most of the holes in the proverbial ship of regular spending. 

Check out Mozo’s budget spreadsheet for a free and easy tool to make your new budget. 

2. Sort out debt

Still paying off that car? Loads of credit card repayments? Sorting out your debt as fast as possible can not only increase the savings for your deposit, but can also take off the pressure while repaying your loan and help you avoid becoming a home loan hostage. 

3. Check out government first home owner schemes

There are several government schemes, both state and federal, that you can take advantage of if you need the support. One of these schemes, the First Home Guarantee (FHBG), has the government act as a guarantor for your first home. What this means is that while your initial deposit (loan-to-value ratio or LVR) usually needs to be 20%, the FHBG allows you to purchase a property with a LVR of 5% or more without paying lenders mortgage insurance (LMI).  

4. Compare home loan providers

When you’re ready to purchase your new home, you’ll need to make sure that you’re getting the loan that works for you. Instead of individually clicking on every site you can imagine, you can use Mozo’s handy comparison tools to find the home loan that works best for you. 

In the end it helps to have a plan! There are more affordable home loans out there and our experts handpick the best ones on the market. Be sure to check out our home loans hub to start comparing.