Budget 2021: Family Home Guarantee to help single parents
Single parents hoping to get a foot on the property ladder will receive a boost this year, following the announcement of a new government initiative as part of the 2021-2022 Federal Budget.
Dubbed the Family Home Guarantee , the program will allow single parents to purchase an existing home or build a new one with a deposit of as little as 2%.
The program will commence 1 July 2021 and stretch over a period of four years, during which it will provide 10,000 guarantees to single parents with dependents.
Importantly, the program won’t just be available to first home buyers. It will also support those hoping to re-enter the housing market after a divorce and family breakdown.
To be eligible, applicants must be Australian citizens, at least 18 years of age, and have an annual taxable income of no more than $125,000.
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Commonwealth Bank chief executive officer Matt Comyn said the measure will provide much-needed support to an often overlooked group.
“This announcement will come as a welcome relief for hard working single parents, particularly those working in essential services such as education, health care and public safety, looking to buy their first home or re-enter the property market,” he said.
Rates of home ownership are typically lower among single parents, who don’t have the benefit of a second income earner to help save for a deposit.
Recognising that home ownership is a key source of intergenerational wealth, the program hopes to help single parents achieve financial security for their families.
The program will benefit single mothers in particular, with the government estimating that 80 per cent of the 125,000 eligible Australians will be women.
The government has also announced an additional 10,000 spots will be made available under the First Home Loan Deposit Scheme.
These will be rolled out on 1 July 2021 and will allow eligible applicants to purchase a home with a deposit of just 5%, with the government guaranteeing the remaining amount.
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