Property myths busted - Part 2
10th Mar 2010
"First home buyers are all in their early 20's"
The widely assumed profile of first home buyers is misleading. A recent report published in The Australian that referred to a survey in which one fifth of first home buyers would ‘give up their dream of owning property' should interest rates hit between 8 and 9%, is an example of misleading information relating to the profile of first home buyers in Australia today.
The article interviewed a single 23 year old woman who was looking to buy a studio apartment in inner Sydney. However, according to the Australian Bureau of Statistics, the median age of first home buyers today is , in fact, a couple with or without dependent children in their early 30s.
While single people in their 20s certainly are entering the property market for the first time, many more are in their 30s, 40s and older. In our experience, a fear of increasing interest rates has little impact on whether they will choose not to enter the property market. It is more a case of overall affordability, personal, employment or family circumstances that is restricting them.
Many first home owners, especially those that are in a younger demographic, may not be aware of alternate, more viable options, to enter the market, while interest rates are so favourable and housing affordability accessible. Those who are limited in making weekly mortgage payments by their lifestyle and affordability, but still are keen to enter the market, may find that they are able to purchase an investment property instead, and continue renting themselves.
The owner will have most of their mortgage repayments covered by the tenant, but first home buyers cannot receive the grant on this investment purchase. Provided they do not live in this property, they can still receive the grant when they purchase a property they do intend to live in.
First home buyers who are keen to enter the market need to speak with a qualified property investment consultant to find out what their best option is, as there may be opportunities available to them that they hadn't expected.