The Australian Bureau of Statistic has just released figures indicating Australians are entering the property market later than ever before.
The 2013-14 data, shows that less than 50% of Australians bought their first home between the ages of 25 and 34 years old. Back in 2000-01 that percentage was up over 60.
One of the more obvious downsides to buying later in life is the prospect of lingering mortgage repayments well into retirement. The proportion of households aged 65 and over still paying off their mortgage has more than doubled, having risen from 3.6% of all households aged 65 and over in 2000–01, to 8.2% in 2013–14.
Buying later can certainly be attributed to a booming Australian property market whereby many young Australians simply cannot afford to pay the impossibly high prices. There are ways to combat this growing trend though. Here are 5 ideas for first home buyers to consider:
1. Investigate all government grants and incentives – there are fewer options available than in the past but some help is still there to take advantage of
2. Look at a unit/apartment rather than a larger house – start small and work your way up over time
3. Ask a parent to guarantee your loan – that way you can borrow up to 95% of your loan without paying Lenders Mortgage Insurance
4. Formulate a strict savings plan – and stick to it! If you can manage to set aside $350 a month, within two years you’ll have saved $20,000!
5. Co-borrow – many first home buyers have shared the costs with a friend, partner or family member with great success. Exercise caution and always seek legal advice.