Home loan schemes are great but knowing the numbers is better

We've heard a lot about the property market this fortnight, especially the lack of affordable housing available to younger buyers.

That's why the federal government stepped in with its various budget fixes, one of which was to expand the First Home Guarantee. Before the Treasurer's recent announcement only singles, couples, and de-facto partners were eligible to apply for national and state First Home Guarantee schemes.

But now any two people who qualify can apply, and that includes your best friend or your little sister. The scheme is also open to non-first time buyers who haven't owned in 10 years.

These changes, among others, are surely welcome by many people. Yet there are probably many who think a lot more could have been done to help homebuyers in a tough market. For example, Corelogic's head of residential research Eliza Owen argues that these changes make this policy (and others) fairer, but still, they may not be effective.

"The relatively high-income thresholds around the First Home Guarantee in particular may help people into housing faster, who would have achieved home ownership anyway, limiting more equitable home ownership across income distributions," she said.

"If interest rates decline, these schemes will make more sense for hopeful home owners comparing the cost of taking on more mortgage debt with the ongoing costs of renting, and they will likely see more take up in the years ahead."

In short, the schemes help people at certain income levels and possibly those already in a position to afford the first deposit for a home. So again, perhaps more can be done.

Home loan schemes aside, what about the market?

The other side of the property equation is the reality of what's available to buyers, first, second or otherwise.

Earlier this month SQM Research noted that national residential property listings fell in April by 9% to 227,020 properties, which is a sizeable drop. This suggests there are simply fewer homes on offer, regardless of what scheme you're thinking of taking up.

SQM says the falls were driven by a significant dip in new listings, which indicates a tentativeness among prospective sellers as we approach the middle of the year. Specifically, Sydney recorded a fall in listings of 13%, while Melbourne, Brisbane and Adelaide also recorded declines of 12%, 11% and 10%, respectively.    

So what's the point? Well, saving money for a first deposit and capitalising on schemes or grants remain important. However, equally crucial is researching your immediate market to understand how much is available to buy.

If there are fewer listings in your suburb of choice and demand there remains strong, chances are you'll end up paying more. A higher price of say 5 or 10% more might end up being detrimental to your plan, making your initial deposit that much higher.

Additionally, the cost of your home loan matters. That's why we offer home loan comparisons on our site, the idea being that you don't have to settle for the highest rate or a loan with limited features.

So yes, make the best of the homeowner schemes available but to make your research thorough you should also:

• Check local property reports to understand the median or average prices.

• Get a sense of how many properties have been listed in recent months on sites like SQM or Corelogic, or simply ask your real estate agent.

• Turn up to open houses and auctions to get an in-person feel for how many buyers are currently looking and how competitive the market is.

Once you've done all this, be sure to start comparing the best home loans on offer, such as the ones below. The goal should be to find a loan with a good interest rate and that overall works for your budget. Not all home loans, like home loan schemes, are created equal!