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Home › News › What Covid19 means for first home buyers
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Jun 26 2020

What Covid19 means for first home buyers

COVID19 has impacted on all sectors of the economy, and property is no different. But it could present an opportunity for first home buyers. 

In March, house prices were up in both Sydney at 14.5 per cent and Melbourne at 12.5 per cent year-on-year. Although sales have dropped, there is still an opportunity for first home buyers to get onto the property ladder.

In fact, buyers searching for Victorian properties on realestate.com.au have jumped 40 per cent amid coronavirus, a sign of optimism returning to the market. 

For first home buyers, COVID19 could present an unprecedented opportunity to get into your first property sooner. With many of us spending more time at home, you might be thinking about changing your four walls to be ones you can truly call your own. Is it possible to ditch renting and buy? Signs point to yes. In fact, here’s 6 reasons that show some unintentional positives in the market for first home buyers.

 

1. Low interest rates

With interest rate offers as low as 2.29 per cent, mortgage repayments have become cheaper than forking out on rent in some locations.

Particularly for dual income households, purchasing a first home is becoming an affordable option.

Now that APRA has relaxed restrictions on how lenders assess a potential lenders ability to meet repayments (dropping the buffer from 7 per cent to 2.5 per cent, getting finance approved can be easier for first-timers.

 

2. Less competition

Buyers shopping back in February may have found intense competition from investors. With many investors exercising caution, now is a great time for first home buyers with a deposit ready to make a move on a property.

Traditionally, an investor and first home buyer are often on the lookout for the same properties. With the current eviction moratorium, investors are taking a backseat leaving the field wide open for savvy first home buyers.

 

3. Sellers open to negotiate

With some restrictions on auctions and viewings, sellers are increasingly willing to negotiate on sale price. Bargains are there for the savvy first home buyer.

 

4. First Home Loan Deposit Scheme

Introduced by the federal government in January, this scheme drops the deposit needed for a non-guardian home loan from 20 per cent down to 5 per cent. For first home buyers with a secure job, eligible applicants could seize upon opportunity here, along with stamp duty exemptions.

If you’ve already successfully applied for the Federal Government’s deposit guarantee, you now have even more time to buy your first home. You can apply for an extension of another 90 days.

From July 1, a further 10,000 guarantees under the First Home Loan Deposit Scheme will become available. 

 

5. HomeBuilder help for COVID19

The federal government has just announced a new $25,000 grant for eligible owner-occupiers (that includes first home buyers) to build or substantially renovate between June and December 2020. 

The catch? There’s a few stipulations such as work must start within three months of signing the contract and there is an income cap. Full information can be found through the Treasury.

 

6. Essential worker? Essential buyer

If you’re fortunate enough to be among the classified essential workers, this can greatly support any pre-approvals for finance. 

However, having a solid deposit and a plan in place to minimise your buyer risks is still important. 

Finding the right property for your situation comes down to the support from your agent. At Amity, we have an experienced team working across all areas of Melbourne to find and sell the best properties for your budget and lifestyle. 

 

For help finding your first home, contact the team at Amity on 03 9090 2500 or email us at info@amity.com.au.

26 June 2020 News

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Member notice: Effective 1 May 2020, the ability for Qantas Frequent Flyer members to earn points with Amity Property will be temporarily unavailable except for selected properties. Transactions made before 1 May 2020 will attract points as normal. If you have any questions or concerns, please contact Amity Property on +61 3 9090 2500 or info@amity.com.au.

You must be a Qantas Frequent Flyer member to earn and use points. A joining fee usually applies, however Amity customers can join for free here. Membership and points are subject to the Qantas Frequent Flyer program terms and conditions.

*Members who purchase an Eligible Property priced up to $599,999.99 will earn 100,000 Qantas Points and members who purchase an Eligible Property priced at or over $600,000 will earn 200,000 Qantas Points. Points will not be earned on any government taxes and charges paid, including stamp duty. This offer applies to all contracts signed on or after 21/03/2018. Amity Property Group reserves the right to withdraw this offer at any time. "Eligible Property" means a new (including off the plan) residential property that has: 1. Been identified by Amity Property Group as an eligible property; and 2. Been purchased under a transaction where the only selling agent is Amity Property Group. Any property where Qantas Points are earned directly from the vendor or where Amity Property Group is not the only selling agent is not an Eligible Property. You must provide your Qantas Frequent Flyer membership number to Amity Property Group prior to the payment of the deposit. Qantas Points will be credited to the nominated Qantas Frequent Flyer account(s) (a maximum of 20 accounts may be nominated) in two stages: stage 1: 10% of the Qantas Points will be credited upon the contract becoming unconditional and the deposit being paid in full and stage 2: the balance of the Qantas Points will be credited upon settlement of the Property and the balance of the purchase price paid in full. Points will be credited to the Qantas Frequent Flyer account(s) within 6 weeks of payment being received in accordance with each stage.

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