Support for next steps on First Home Loan Deposit Scheme
WITH housing a national priority, the Housing Industry Association has welcomed the Senate passing legislation that will facilitate the next step in making the First Home Loan Deposit Scheme a reality.
HIA Managing Director Graham Wolfe says that the bill’s passage means that the National Housing Finance and Investment Corporation will be able to offer the deposit guarantees that underpin the First Home Loan Deposit Scheme.
“The legislation also establishes a new housing research function within NHFIC, which is supported by $25 million in funding, to examine housing demand, supply and affordability,” he said.
“HIA has long argued that there needs to be a national approach to helping first home buyers enter the market and to address the time that saving a deposit now takes.
“First home buyers are concerned about the time it takes to save a 20 per cent deposit and the added upfront cost of mortgage insurance when seeking a loan with less than 20 per cent deposit.
Mr Wolfe said there were a impediments, like stamp duty, securing finance and saving for a deposit, to people buying their first home and that’s where the recent Senate changes can help.
“This Scheme can make a real difference, HIA estimates show that the Scheme could save an average first home buyer with less than 20 per cent deposit tens of thousands of dollars over the life of their loan,” he said.
“Helping 10,000 first home buyers a year achieve their home ownership dream sooner, by providing a guarantee to support eligible buyers approach a lender with a deposit of 5 per cent or more, will take some of this pressure off.
With research showing that half of all renters believe they will never afford to buy a home even though over 90 per cent of renters would like to, they are set to be big winners from FHLDS.
“Renters will also benefit from the Scheme as more new houses and more homeowners mean more supply and less pressure on rental prices,” Mr Wolfe said.
“It is widely accepted that long term, secure and stable housing tenure helps people achieve many of their life goals, and that home ownership matters to the wellbeing of the economy and the community concluded.”