Victorian government introduces new scheme to make it easy for first home buyers to enter property market

The Victorian government is asking struggling Victorians to register for a new scheme in order to make their first home purchase affordable.

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The Andrews Labor Government is calling on Victorians struggling to earn and save enough to buy a house to register for a new scheme that will help more people buy their first home, sooner.

In a media release, the government has announced that from today, first home buyers can express their interest in being part of HomesVic. This is a shared equity scheme that will see the Government provide up to 25 per cent of the initial price of a buyer’s first home.

This will make a real difference – helping people get into their first home, sooner,” said Premier Daniel Andrews.

By taking an ownership stake, the Government will help give these first home buyers the start they need – enabling them to enter the market earlier by reducing the amount of money they require for their home loan.

Ashrit khattar has been in Australia for four years and is in the market for his first home. Even though he appreciates government’s help, he does not see long term benefits in it.

“I appreciate the initiative that the government has taken and Australia is known to be a society where government’s push towards social welfare is a big thing, but I think this has started to move towards appeasement politics. These reforms in the long run are not going to help the society,” he told SBS Punjabi.

Instead, he thinks that the help should be more straight forwards in the way of relaxing lending costs and cutting foreign investment.

You enable people to buy houses by relaxing the lending rules instead of just putting money in their pocket. If the government actually wants to help people buy houses they should actually target the problems like inflation that’s happening because of all the artificial investment coming from offshore.”

Applications for this scheme will officially open February next year and the pilot scheme will begin in early 2018. The initial allocation will be of $50 million given over two years.

This pilot scheme will be available to 400 first home buyers who met the eligibility criteria. Eligibility will target applicants with incomes of up to $75,000 for singles, or up to $95,000 for couples or families. Buyers will need to have a 5 per cent deposit.

Priority will be given to homes in areas where there is a high demand for housing and good access to employment, public transport and other services.

Selected areas in metropolitan Melbourne and certain commuter towns and regional centres will be announced early next year, prior to applications opening.

When the properties are sold, participating buyers will pay the proportional interest, which the Government will reinvest back in the scheme.

Earlier this year, Victorian government had abolished stamp duty for forst home buyers on properties valued under $600,000 and had also provided concessions for houses between $600,000 and $750,000. These announcements were made as part of Labor Government’s Homes for Victorians package.

More than three thousand Victorians have benefited from these changes and HomesVic is also part of this package.  

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Source: SBS

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