Aussie first home buyers double in 2020
Prospective first home buyers have more than doubled in 2020, according to new research from Westpac.
The big bank found 16% of Australians are now looking to enter the property market in the next five years, compared to 7% in 2019.
Leaving share houses or family homes has been a big motivator, with 69% of people surveyed looking to step onto the property ladder and away from shared living after the long stretch of COVID social restrictions.
The report highlighted other influential factors including not wanting to pay rent (54%) seeking more stability (39%) and financial security (37%).
Where do first home buyers want to live?
While working remotely has become the norm for many who are in a position to do so, Westpac found there’s still strong sentiment to live in relatively close proximity to CBD’s across the country.
Those considering property in Sydney and Perth are inclined to purchase within 10km of the city centre. First home buyers bound for Adelaide or Brisbane are looking at homes up to 20km out of the CBD, while Melbournian buyers are considering purchases as far as 40km away from the city.
Westpac’s managing director of mortgages, Anthony Hughes said an emerging younger generation of buyers is leading this trend of staying tied to metropolitan life.
“Many are weighing up areas that would enable them to maintain a certain lifestyle, like Sydney’s Inner West which is in close proximity to social hubs and nightlife, while also catering to changing needs like the ability to work from home more,” he said.
While lifestyle factors are important, average suburb prices should always be kept mind as they can change quite dramatically depending on a few kilometres distance.
For example, the average price for a two bedroom house in the Inner West suburb of Leichhardt is $1.2 million, with one bedroom apartments going for $687,000 according to Domain data . Then in Campsie – just 7km south-west – those prices drop to $778,000 and $490,000 respectively.
RELATED: Property sentiment up as Aussies expect price lifts.
How can first home buyers reduce home loan costs?
Whether you’re looking to buy a rural property or a city apartment, there are a few handy schemes and tips which can help you save money on your first home. Look into:
- The First Home Loan Deposit Scheme. This is a government offer which lets you avoid paying lenders mortgage insurance (LMI), which is often applied to home loans if you haven’t saved up a 20% deposit. So long as you have a 5% deposit the government acts as a guarantor for the remainder. Places in this scheme are limited.
- The First Home Owners Grants. Depending on where you live in Australia, what kind of home you’re buying and what kind of home loan you take out, you could score a lump sum payment from the government to put towards your home deposit. There are also some exemptions from paying stamp duty – which NSW plans to phase out completely.
- The First Home Super Saver Scheme. If you’re trying to save up a juicy deposit, this scheme allows you to grow it through additional super contributions, which earn a higher rate of interest and are taxed less. You can save up to $30,000 over two financial years. It’s especially helpful for couples or people buying a home together, as they can independently accrue the $30,000 and combine funds to make the purchase. You’re required to use it for a property purchase within 12 months of withdrawing the funds.
- Choosing the right home loan. Your home loan interest rate and features can cut your repayments by tens of thousands of dollars over the life of your loan. So, do you research and find a top-value option that suits your needs and budget.
Home loan comparisons on Mozo
Promoted
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Fixed Express Home Loan
- Owner Occupier
- Principal & Interest
- Interest rate
-
5.99
%
p.a.
Fixed 2 years
- Comparison rate
-
6.14
%
p.a.
- Initial monthly repayment
-
$4,312
Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).
- Interest rate
-
5.99
%
p.a.
Fixed 2 years
- Comparison rate
-
6.14
%
p.a.
- Upfront fees
-
$134
- Ongoing fees
-
$10.00 monthly
- Discharge fee
-
$350.00
- Extra repayments
-
yes - up to 20% during the fixed period
- Redraw facility
-
yes - free
- Offset account
-
yes - partial only
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $5,000
- Maximum borrowing amount
- $10,000,000
- Type of mortgage
- Fixed
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- -
Read our Mozo Review to learn more about this Bendigo Bank Fixed Express Home Loan
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3 Year Special Fixed Home Loan
- Owner Occupier
- Principal & Interest
- Interest rate
-
5.69
%
p.a.
Fixed 3 years
- Comparison rate
-
6.16
%
p.a.
- Initial monthly repayment
-
$4,174
This home loan is available for purchase or refinance, complete with 1, 2 or 3 year fixed rate options. Minimum 10% deposit required.
- Interest rate
-
5.69
%
p.a.
Fixed 3 years
- Comparison rate
-
6.16
%
p.a.
- Upfront fees
-
$530
- Ongoing fees
-
$0.00
- Discharge fee
-
$0.00
- Extra repayments
-
yes - free up to $10,000 p.a.
- Redraw facility
-
no
- Offset account
-
no
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $50,000
- Maximum borrowing amount
- $1,000,000
- Type of mortgage
- Fixed
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- -
Read our Mozo Review to learn more about this loans.com.au 3 Year Special Fixed Home Loan
Go to site
-
3 Year Special Fixed Home Loan
- Owner Occupier
- Principal & Interest
- Interest rate
-
5.69
%
p.a.
Fixed 3 years
- Comparison rate
-
6.16
%
p.a.
- Initial monthly repayment
-
$4,174
This home loan is available for purchase or refinance, complete with 1, 2 or 3 year fixed rate options. Minimum 10% deposit required.
- Interest rate
-
5.69
%
p.a.
Fixed 3 years
- Comparison rate
-
6.16
%
p.a.
- Upfront fees
-
$530
- Ongoing fees
-
$0.00
- Discharge fee
-
$0.00
- Extra repayments
-
yes - free up to $10,000 p.a.
- Redraw facility
-
no
- Offset account
-
no
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $50,000
- Maximum borrowing amount
- $1,000,000
- Type of mortgage
- Fixed
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- -
Read our Mozo Review to learn more about this loans.com.au 3 Year Special Fixed Home Loan
Go to site -
Fixed Express Home Loan
- Owner Occupier
- Principal & Interest
- Interest rate
-
5.99
%
p.a.
Fixed 2 years
- Comparison rate
-
6.14
%
p.a.
- Initial monthly repayment
-
$4,312
Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).
- Interest rate
-
5.99
%
p.a.
Fixed 2 years
- Comparison rate
-
6.14
%
p.a.
- Upfront fees
-
$134
- Ongoing fees
-
$10.00 monthly
- Discharge fee
-
$350.00
- Extra repayments
-
yes - up to 20% during the fixed period
- Redraw facility
-
yes - free
- Offset account
-
yes - partial only
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $5,000
- Maximum borrowing amount
- $10,000,000
- Type of mortgage
- Fixed
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- -
Read our Mozo Review to learn more about this Bendigo Bank Fixed Express Home Loan
Go to site -
Offset Home Loan
- Fixed
- Owner Occupier
- Principal & Interest
- LVR 80-95%
- Interest rate
-
6.09
%
p.a.
Fixed 3 years
- Comparison rate
-
7.11
%
p.a.
- Initial monthly repayment
-
$4,359
- Interest rate
-
6.09
%
p.a.
Fixed 3 years
- Comparison rate
-
7.11
%
p.a.
- Upfront fees
-
$350
- Ongoing fees
-
$248.00 yearly
- Discharge fee
-
$400.00
- Extra repayments
-
yes - up to $10,000 p.a.
- Redraw facility
-
yes - free
- Offset account
-
yes
- Maximum loan to value ratio
- 95.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- $10,000,000
- Type of mortgage
- Fixed
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Monthly
- Special offers
- -
Read our Mozo Review to learn more about this Macquarie Offset Home Loan
Go to site -
Simple Home Loan Variable
- Owner-Occupied
- Principal and Interest
- LVR>70%
- Interest rate
-
6.19
%
p.a.
Variable
- Comparison rate
-
6.19
%
p.a.
- Initial monthly repayment
-
$4,405
Enjoy a low variable rate with no application, ongoing or monthly fees to pay. Access your money via internet banking at any time with free redraws. Make additional repayments at any time. Available for owner occupied, investment and interest only repayments.
- Interest rate
-
6.19
%
p.a.
Variable
- Comparison rate
-
6.19
%
p.a.
- Upfront fees
-
$0
- Ongoing fees
-
$0.00
- Discharge fee
-
$175.00
- Extra repayments
-
yes - free
- Redraw facility
-
yes - free
- Offset account
-
no
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- $3,500,000
- Type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- -
Read our Mozo Review to learn more about this First Option Bank Simple Home Loan Variable
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Basic Home Loan
- Owner Occupier
- LVR 80-90%
- Principal & Interest
- Interest rate
-
6.39
%
p.a.
Variable
- Comparison rate
-
6.41
%
p.a.
- Initial monthly repayment
-
$4,499
- Interest rate
-
6.39
%
p.a.
Variable
- Comparison rate
-
6.41
%
p.a.
- Upfront fees
-
$350
- Ongoing fees
-
$0.00
- Discharge fee
-
$400.00
- Extra repayments
-
yes - free
- Redraw facility
-
yes - free
- Offset account
-
no
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- $10,000,000
- Type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Monthly
- Special offers
- -
Read our Mozo Review to learn more about this Macquarie Basic Home Loan
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Offset Home Loan
- Owner Occupier
- LVR 80-90%
- Principal & Interest
- Interest rate
-
6.39
%
p.a.
Variable
- Comparison rate
-
6.64
%
p.a.
- Initial monthly repayment
-
$4,499
- Interest rate
-
6.39
%
p.a.
Variable
- Comparison rate
-
6.64
%
p.a.
- Upfront fees
-
$350
- Ongoing fees
-
$248.00 yearly
- Discharge fee
-
$400.00
- Extra repayments
-
yes - free
- Redraw facility
-
yes - free
- Offset account
-
yes
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- $10,000,000
- Type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Monthly
- Special offers
- -
Read our Mozo Review to learn more about this Macquarie Offset Home Loan
Go to site -
Discounted Home Value Loan
- Owner Occupier
- Principal & Interest
- LVR 80-90%
- Interest rate
-
6.44
%
p.a.
Variable
- Comparison rate
-
6.44
%
p.a.
- Initial monthly repayment
-
$4,523
Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Settlement fee waived on new borrowings from $50,000 (T&Cs apply).
- Interest rate
-
6.44
%
p.a.
Variable
- Comparison rate
-
6.44
%
p.a.
- Upfront fees
-
$0
- Ongoing fees
-
$0.00
- Discharge fee
-
$300.00
- Extra repayments
-
yes - free
- Redraw facility
-
yes - free
- Offset account
-
no
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $50,000
- Maximum borrowing amount
- $15,000,000
- Type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special offers
- -
Read our Mozo Review to learn more about this HSBC Discounted Home Value Loan
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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.
** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.
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