Report shows Australian couples will need to save for an average 4.2 years to accumulate the almost $100,000 needed for a 20 per cent deposit on the median-priced home.
In Sydney, the time needed to save a deposit was nearly twice as long, at 7.9 years, this assumes couple are saving 20% of their after tax income.
Reports which aren’t based on reality get quite boring. Fact is that most first home buyers:
1) do not necessarily NEED to buy a median property for their initial purchase
2) do not need to save 20% for their first depositBut I guess it wouldn’t be as interesting to write a report on couples taking 18 months to save for a deposit to provide one of the most basic requirements in life – a roof over their head (that they own).
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
A 20% deposit isn’t mandatory – some lenders still do 95% loans.
Some states have attractive incentives for FHBs too. Look at ACT and NSW for instance – if it’s a new property you might get the FHOG and not pay stamp duty.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
really guys…?
If you cant save 20% for a deposit…..then should you really be buying now?
Or maybe you are buying too much house for what you can afford, get yourself into a starter apartment rather than median mcmansion in the perfect suburb.
you can use the equity you build after 4-5 years in the starter apartment as a deposit on your mcmansion or better still keep it as in IP and move into a step up apartment.
Cant believe you guys are professional loan brokers and really suggesting people should be taking out 95% loans based on how risky it is at the moment…….
I know this is going to take the post off topic…..but I feel someone has to be saying it.
Corey got it in one :-
Reports which aren’t based on reality get quite boring. Fact is that most first home buyers do not necessarily NEED to buy a median property for their initial purchase.
When DID it happen that any couple’s first home HAD to be a McMansion with 4bd, 2ba, 2g ? What happened to sitting on orange boxes in a humble little “below median” first home until your wage (and equity in that first home) allowed you to move on.
A friend, back when we were doing this, had urged “First, get on the train – you can always change carriages later!” He maintained that we needed to get onto the equity growth train that hauls even the most humble of properties along. So we did.
Our first home was purchased in 1973 via a Sale by Agreement, and certainly below median for the area. A year later, we refinanced (as per the purchase conditions) with another lender. Ten years later, we sold it for two-and-a-half times what we had purchased it for. That equity boost (along with a wages boost) allowed us to move up a rung or two.
Of course, that was then – but is it really so much different today? Sure, the prices are way higher, but so too are wages.
Benny
really guys…?
If you cant save 20% for a deposit…..then should you really be buying now?
Or maybe you are buying too much house for what you can afford, get yourself into a starter apartment rather than median mcmansion in the perfect suburb.
you can use the equity you build after 4-5 years in the starter apartment as a deposit on your mcmansion or better still keep it as in IP and move into a step up apartment.
Cant believe you guys are professional loan brokers and really suggesting people should be taking out 95% loans based on how risky it is at the moment…….
I know this is going to take the post off topic…..but I feel someone has to be saying it.Except there is no universal rule dictated by the functions of the universe that a 20% deposit is ‘safe’, ideal or the only responsible response.
It’s not a matter of whether someone can save a 20% deposit, anyone who can save 10% can also save a further 10% – it’s about timing. If a borrower decides they would rather cut their saving time in half and utilise LMI effectively – what’s the issue?
Tell us more about how ‘risky’ it is – and how having a nominally lower loan amount will mitigate said risks. If you’re talking about a correction (and believed this is a likely scenario), it wouldn’t be prudent to advise *anyone* to borrow or buy.
Benny: Exactly right – as with everything, work your way up the ladder. My first car wasn’t a BMW M3, my first flight wasn’t in first class – why would the first house be anything other than simple unless you have significant means. But sensationalism is so much fun for the media and readers.
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This reply was modified 8 years, 6 months ago by
Corey Batt. -
This reply was modified 8 years, 6 months ago by Corey Batt.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
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This reply was modified 8 years, 6 months ago by
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