First home buyers surge as 5% deposit scheme expansion fuels demand
First home buyers are becoming a major force in the market following last month’s expansion of the federal government’s 5% Deposit Scheme, with activity lifting sharply across the affordable end.
New Cotality figures confirm that properties priced within the updated scheme caps are rising faster than those above those levels. The lower quartile of the market climbed 4.2% over the past three months, outpacing the upper quartile's 2.2%.
With caps now at $1.5 million in Sydney, more first home buyers are able to compete confidently. According to Housing Minister Clare O’Neil, there were 5,778 guarantees under the scheme issued in October, including 2,700 that became eligible only after October’s changes to property and income caps came into effect.
Cotality’s research director, Tim Lawless, said the uplift reflects “clear outperformance” at the affordable end, adding that strong first home buyer participation is one reason for the momentum and that demand in this segment remains firm.
About the author – Alex Veljancevski is a Sydney Mortgage Broker with Eventus Financial, which assists first home buyers, investors, upgraders and borrowers seeking to refinance to a better deal on their home loan.