New Investment Approach for Australian New Homebuyers
New Investment Approach for Australian New Homebuyers
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
Recent statistics have highlighted a notable shift in the strategies Australian first-time homebuyers are using to infiltrate the challenging property market.
Analysis of 2023's purchasing trends indicates an emerging investor mentality among new buyers.
According to the latest insights from the Lendi home loan network, 20% of first-time property acquisitions were made with a clear investment intention, renting out newly bought homes instead of occupying them. This phenomenon, known as 'rentvesting,' exhibits the increasing financial savvy of new entrants to the housing market.
Mortgage experts confirm that a significant portion of these buyers are prioritising their current way of life, opting to reside with family or lease in preferred locales while investing in more affordable areas. This strategy has particularly taken hold in Queensland, which reported a sharp increase in first home buys at the commencement of this year, likely boosted by recent government incentives.
The prevalence of rentvesting was uneven across the states, with New South Wales leading at 30%, Queensland at 26%, and Victoria close behind at 20%. The trend was less common in Western Australia and South Australia, registering only 10 and 7 percent, respectively. Intriguingly, the start of 2024 saw Queensland sprint ahead as 45% of all property deals in January were first home purchases.
The noticeable upswing in Queensland comes on the heels of the state government's decision to increase First Home Buyer grants to $30,000. This drawcard may well have accelerated the 'rentvestment' strategy as a feasible option for many Young Australians.
Exploring further nuances, Lendi's research uncovered that some first home buyers are pooling resources, with at least six percent of acquisitions involving three or more loan applicants, aimed at mitigating financial stress.
Financial creativity did not stop at group purchasing; there's also been a doubling in guarantor loans, where the backing, typically from family members, provides the requisite security for loan approval. With the aid of a guarantor, deposits averaged considerably lower, at around $38,000, demonstrating an alternative pathway into homeownership.
This report paints an evolving picture of a generation of Australians determined to carve their heritage in real estate through more inventive avenues, reflecting a growing adaptability in response to a transforming market landscape.
Published:Monday, 25th Mar 2024 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
Extreme weather events are increasingly disrupting global shipping routes, leading to extended voyage times and heightened risks for marine insurers. In Australia, these disruptions are particularly concerning given the nation's reliance on maritime trade and the popularity of personal watercraft among enthusiasts. - read more
The Marina Industries Association (MIA) has unveiled a new online Work Health & Safety (WHS) Best Practice Course, specifically designed to address the unique risks and challenges faced by professionals in marina environments. This initiative underscores MIA's commitment to promoting safety and operational excellence within the Australian marina industry. - read more
Pelagic Risk Services, a specialist marine insurance broker, has recently elevated its support for the Australian marina industry by upgrading its sponsorship of the Marina Industries Association (MIA) from Silver to Gold. This move signifies Pelagic's deepening commitment to the sector and its dedication to providing tailored insurance solutions for marina operators across the nation. - read more
Welcome to the world of savvy home financing! Whether you’re a first-time homebuyer or seasoned investor, navigating the ocean of home loan options can be daunting. In this digital era, one tool stands out for its effectiveness in simplifying this journey: the online home loan calculator. - read more
Creating a sturdy financial foundation is essential for Australians navigating the often turbulent waters of debt. A bulletproof budget does more than just track expenses; it acts as a buffer against unexpected financial downturns and provides a clear path toward financial freedom. Comprehending the full weight of this importance is the first step to turning one's financial destiny around. - read more
In recent years, refinancing has emerged as a popular financial strategy for many Australian homeowners. With the housing market's dynamic nature and fluctuating interest rates, more people are considering the benefits of refinancing their home loans. This trend is not surprising, as refinancing can potentially reduce monthly payments, secure lower interest rates, and assist with debt consolidation. - read more
Knowledgebase
Subprime Loan: A type of loan offered to individuals with poor credit scores, typically at a higher interest rate.
