Home loan help and gov grants best way to beat lack of affordability
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With Sydney’s property market now in the top 10 most unaffordable cities globally, doing your homework on homebuying is more important than ever.
A new report by the Committee for Sydney shows that the harbour city has obvious housing problems, including a lack of property supply, poor planning and a culture that prioritises property investment, among other things.
As a result, Sydney’s chronically unaffordable housing is among the worst in the world (6th on the Committee’s list), costing the city $10bn a year.
This scenario has obviously made buying a home a lot harder in recent years but anyone in the Sydney market (or similar) should note that a range of homebuyer schemes have helped many first timers, while lower first deposit rules on certain home loans have also reduced the barrier to entry.
Low deposit home loans and homebuyer grants
If you’re looking at home loan providers right now, there are some that allow smaller first deposits than the standard 20%. For example, Bendigo Bank’s Express Home Loan permits a 10% deposit and has a variable interest rate of 5.72%.
Also, Loans.com.au’s Variable Home Loan 90 also allows a 10% deposit and has a variable interest rate of 5.79%. These rates are well under the average of 6.60% for variable home loans.
Meanwhile, there are several government-led schemes you can tap into as a first-time buyer. Under the First Home Buyers Grant, for instance, an eligible home buyer can buy a home with as little as 5% deposit without paying Lenders Mortgage Insurance. This grant runs until June 30, 2024. Additionally, each state offers its own schemes such as the First Home Owners Grant in New South Wales which lets home buyers who build a new home or buy a brand new or substantially renovated property receive a $10,000 grant.
There are eligibility rules for all grants, so be sure to review the fine print before going ahead.
Beyond prices, why does housing affordability matter so much?
Housing affordability isn’t only about the impact on people’s finances but also can contribute to a city’s happiness, inequality, vibrancy, transport and commuting times, and reduced access to important community services.
Among the solutions offered by the Committee for Sydney are an update of zoning rules to help new builds, investment in building more social and affordable housing, and an increase in housing in areas that have good transport connectivity and amenities.
While our governments hopefully work on such solutions, you can help yourself now by researching the best home loans available but also the suburbs that offer value for money.
Transport and amenities have increasingly improved in outer ring suburbs and that’s important because the price difference inside 25 kilometres from any given Aussie CBD is much higher than locations farther out. It’s worth checking a few options to see how far your money - and home loan - can take you.
If you’re ready to take the next step and compare home loans in the market, our experts at Mozo have pinpointed some of the best. Get your homebuying journey started and compare now!
Home loan comparisons on Mozo
Promoted
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Basic Home Loan
- Owner Occupier
- LVR 90-95%
- Principal & Interest
- Interest rate
-
7.19
%
p.a.
Variable
- Comparison rate
-
7.22
%
p.a.
- Initial monthly repayment
-
$4,747
- Interest rate
-
7.19
%
p.a.
Variable
- Comparison rate
-
7.22
%
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
- 95.00%
- 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
-
OMG Home Loan
- Owner Occupier
- Principal & Interest
- >80% LVR
- Interest rate
-
6.29
%
p.a.
Variable
- Comparison rate
-
6.32
%
p.a.
- Initial monthly repayment
-
$4,328
BCU Bank’s OMG owner occupied home loan offers a variety of great low rates depending on your deposit. Save with no ongoing annual fees. Access your extra payments when you need to through the redraw facility. Pre-approval valid for 3 months.
- Interest rate
-
6.29
%
p.a.
Variable
- Comparison rate
-
6.32
%
p.a.
- Upfront fees
-
$300
- Ongoing fees
-
$0.00
- Discharge fee
-
$395.00
- Extra repayments
-
yes - free
- Redraw facility
-
yes - free
- Offset account
-
no
- Maximum loan to value ratio
- 95.00%
- Minimum borrowing amount
- $20,000
- Maximum borrowing amount
- $1,500,000
- 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 BCU Bank OMG Home Loan
-
Basic Home Loan
- Fixed
- Owner Occupier
- Principal & Interest
- LVR 80-95%
- Interest rate
-
6.75
%
p.a.
Fixed 3 years
- Comparison rate
-
7.09
%
p.a.
- Initial monthly repayment
-
$4,540
Get a flexible loan structure with up to six loan accounts with different rate types. Make free extra repayments. Enjoy free redraw facility. No upfront or ongoing fees. Option to earn Qantas points.
- Interest rate
-
6.75
%
p.a.
Fixed 3 years
- Comparison rate
-
7.09
%
p.a.
- Upfront fees
-
$350
- Ongoing fees
-
$0.00
- Discharge fee
-
$400.00
- Extra repayments
-
yes - up to $10,000 p.a.
- Redraw facility
-
yes - free
- Offset account
-
no
- 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 Basic Home Loan
-
Offset Home Loan
- Fixed
- Owner Occupier
- Principal & Interest
- LVR 80-95%
- Interest rate
-
6.75
%
p.a.
Fixed 3 years
- Comparison rate
-
7.30
%
p.a.
- Initial monthly repayment
-
$4,540
- Interest rate
-
6.75
%
p.a.
Fixed 3 years
- Comparison rate
-
7.30
%
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
-
Special Real Deal Home Loan
- Owner Occupier
- Principal & Interest
- LVR 80-95%
- Interest rate
-
6.84
%
p.a.
Variable
- Comparison rate
-
6.88
%
p.a.
- Initial monthly repayment
-
$4,582
Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.
- Interest rate
-
6.84
%
p.a.
Variable
- Comparison rate
-
6.88
%
p.a.
- Upfront fees
-
$595
- Ongoing fees
-
$0.00
- Discharge fee
-
$250.00
- Extra repayments
-
yes - free
- Redraw facility
-
yes - fees apply
- Offset account
-
no
- Maximum loan to value ratio
- 95.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- -
- 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 Newcastle Permanent Special Real Deal Home Loan
-
Basic Home Loan
- Owner Occupier
- LVR 90-95%
- Principal & Interest
- Interest rate
-
7.19
%
p.a.
Variable
- Comparison rate
-
7.22
%
p.a.
- Initial monthly repayment
-
$4,747
- Interest rate
-
7.19
%
p.a.
Variable
- Comparison rate
-
7.22
%
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
- 95.00%
- 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
-
Offset Home Loan
- Owner Occupier
- LVR 90-95%
- Principal & Interest
- Interest rate
-
7.19
%
p.a.
Variable
- Comparison rate
-
7.43
%
p.a.
- Initial monthly repayment
-
$4,747
- Interest rate
-
7.19
%
p.a.
Variable
- Comparison rate
-
7.43
%
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
- 95.00%
- 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
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