Schemes missing their mark
Many first home buyers who realise they can't buy because of their borrowing capacity look to purchase an investment property instead.
SYDNEY mortgage broking company founder Jason He says government help is often failing to meet its aims.
Kaleido Loans’s founder Jason says while most federal and state level initiatives cut the deposit barrier for first home buyers “what we are seeing on the ground is that borrowing capacity is holding back a lot of first home buyers even when they only need a 5% deposit and, in most cases, don’t have to pay any stamp duty”.
“Many first home buyers we are talking to are struggling to get the borrowing capacity for the loan that they need,” He explains.
For this reason, the founder says many of his clients are taking an alternate, more long-term, approach to purchasing a dwelling to occupy.
“Many of our first home buyer clients who realise they can’t purchase their ideal property due to the borrowing capacity issue are looking to purchase an investment property instead,” He says.
“This allows them to borrow more and they can access different property markets interstate where the purchase price is lower compared to buying an owner-occupied property.
“By doing this, they’re at least not missing out on getting onto the housing ladder, and they will have an asset that is appreciating in value and generating an income.”
Ultimately, the goal is to sell this property and then “purchase their dream home with a combination of a higher income as they progress in their careers”.
