First-home buyers are turning to help from family, government guarantees, and lenders mortgage insurance to get into the market faster.
The time taken to save for a home has soared in recent years, leaving fewer first-home buyers willing or able to save a 20 per cent deposit.“It’s not really the goal,” Melbourne mortgage broker Daniel Koutzamanis, director of BLVD Finance, said of reaching the traditional 20 per cent deposit. “With first-home buyers, the conversation is more around what’s the minimum I need … to get a foot in the door.
“First home buyers are still striving to get to that 20 per cent, but not a high number are actually getting to it, especially not in our area,” he said. First-home buyers have been turning to government guarantee schemes, and family help, to get into the market sooner.Prospective homebuyers in Sydney would need to give up 52,191 takeaway coffees to save enough for a median home deposit, Finder modelling shows, or skip more than 11,000 meals out. Their Melbourne counterparts would need to skip about 35,700 coffees or some 8050 meals out before the savings equated to a 20 per cent deposit.
Mr Algar is already seeing some first home buyers, mostly those able to live in the family home, now delaying plans to purchase, deciding they would rather keep saving as prices were no longer running away from them. He had yet to hear concerns from first home buyers about the risk of falling into negative equity, if they purchased with a small deposit in a cooling market, but felt it was something they should be mindful of.
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