One-eighth of all first home buyers who purchased a home between March and June 2020 did so using the First Home Loan Deposit Scheme, a new report shows.
Roughly 12.5% of all homes purchased by first home buyers during the pandemic's peak months were done so utilising the scheme, according to the scheme's administrator the National Housing Finance and Investment Corporation (NHFIC).
The first home loan deposit scheme (FHLDS) was launched on January 1 2020 by the Federal Government to help first home buyers secure a home loan with a deposit as little as 5% while avoiding the high cost of Lenders Mortgage Insurance (LMI).
A new report by the NHFIC said the scheme has supported many younger buyers, but also some older cohorts.
"The Scheme has had broad geographical reach supporting first home buyers across the country with strong interest from buyers in outer metropolitan and regional areas," the report said.
"First time buyers have been able to bring forward their home purchases in line with the objectives of the Scheme. FHLDS has now cemented itself as part of the first home buyer support policy architecture."
The scheme may have helped increase first home buyers' share of the market, with CoreLogic's head of research Eliza Owen last week reporting first home buyers made up 29.5% of all owner-occupier commitments in June, far above the 23.2% decade average.
"The expansion of the first home loan deposit scheme and other first home buyer incentives announced over June and July is likely to see a boost in first home buyer participation over the second half of 2020," Ms Owen said.
Article by William Jolly on August 31, 2020
Message from CAtherine
Occasionally I come across an interesting article to do with Home Loans. I thought I'd share some of these with you here.