Labor brings forward the Regional First Home Buyer scheme by three months
From October 2022, the new guarantee will help up to 10,000 regional Australians every year to get into their first home with as little as a 5% deposit.
The Labor Government has announced it will bring forward the introduction of the Regional First Home Buyer Guarantee - originally available from January 2023 - to relieve the ongoing housing pressures facing those in regional areas.
The government guarantees up to 15% of the purchase price for eligible first home buyers, allowing regional Australians who are looking to buy to avoid paying lenders mortgage insurance, which can costs thousands or tens of thousands of dollars.
As an expansion to the Federal Government’s Home Guarantee Scheme, the Regional First Home Buyer Guarantee is only available to locals who have been living in the region they want to buy for at least one year.
Housing Minister Julie Collins said housing affordability was one of Australia's biggest challenges.
"Safe and affordable housing is central to the security and dignity of all Australians, but years of inaction on policy at a federal level - combined with devastating floods and fires - have increased pressure on people living outside our big cities," Ms Collins said.
Ms Collins also cited research from the Australian National University and the ANZ CoreLogic Housing Affordability Report, which revealed it now takes the average home buyer in regional areas 11.1 years to save for a house deposit.
In conjunction with other housing initiatives, Ms Collins said the government aims to cut that time taken to save in-half.
The Labor Government's announcement also comes off the back of new research by CoreLogic, which found that units in regional areas, with a more affordable median value, have fallen -1.3% since peaking in June, equivalent to approximately -$7,000.
CoreLogic Economist Kaytlin Ezzy said the current tightening cycle has seen the cash rate rise 2.25% in just five months, the fastest increases seen since 1994.
"While Australia’s unit market has been somewhat more resilient to falling values than the detached housing segment, it has not been immune, with many households being sensitive to increased interest rates due to high debt levels along with high inflation.” Ms Ezzy said.
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