March 20, 2010 Leave a comment
The number of first home buyers in the marketplace has dropped significantly, but according to Mark Millington from First National Real Estate Lakeshores, there is still plenty of opportunity for first home buyers to realise their dreams of home ownership.
“Since October last year, market share for first home buyers has decreased from 26 per cent to 22.1 per cent currently,” Mark Millington said.
“And the potential for escalating interest rates, which have now been on hold for three consecutive months, along with government taxes and high up-front costs may make things even harder for first time buyers to save for that ever-important, yet growing in size, deposit.”
Mark Millington does have some advice to offer first home buyers, whose confidence is waning as house prices are set to continue soaring growth throughout 2010.
“First home buyers need to be more financially savvy if they are going to get into the housing market in the coming twelve months,” Mark Millington said.
“They need to be able to make sound financial decisions, based on a level of certainty around interest rates.
“This is why we recommend they seek the services of a financial advisor who can assist them to establish a savings plan and budget to track their expenses and identify areas where they can cut back on their expenditure.”
Establishing a budget is about setting realistic timeframes, estimating income and expenses accurately and then tracking and monitoring spending to identify areas where belts can be tightened.
“There are also still in place a number of government assistance schemes, such as the First Home Saver Accounts and First Home Owners Grant which can also assist greatly,” Mark Millington said.
Other hints for first home buyers include keeping an eye on the market at all times, talking to good agents about where the bargains lay in a suburb, and shopping around for good mortgage deals.
“Look for mortgage deals where you are able to pay back more than the monthly repayments, which can often reduce the term or interest payable on the mortgage significantly,” Mark Millington said.
“Or, consider switching from a standard to a basic, or no frills, home loan which can potentially cut interest rates by around 0.4 per cent, but potentially may take away the flexibility to achieve other savings such as extra repayments.”
First home buyers need to reclaim their share of the property market and take advantage of the services and incentives currently on offer.