House prices have fallen across Australia for the first time in 15 years, yet a local home-buyer in Ballarat is building into that market using a government scheme.
What happened: The Federal Member for Ballarat, Catherine King, hosted a press conference on Friday morning, speaking from the newly-purchased Winter Valley land of Miriam Litwin.
Litwin appeared alongside King to discuss the government schemes aimed at new and first home buyers.
Image: MP Catherine King and first-time homeowner Miriam Litwin
The market: A report from Domain, released in September, found house prices have fallen across each capital city for the first time in 15 years - and second time on record.
The report cited pressures from cost-of-living, higher interest rates and changes to housing investment tax policy as issues weighing on buyers.
Negative equity has been raised as well.
What is that? Negative equity is what happens when the amount a buyer still owes is greater than a property’s current market value.
A nation-wide decrease in home prices has the potential to drive more homeowners into this situation.
When asked about the falling prices, Minister King said the government “[does not] control that”, but what they are seeing and “really liking” is the opportunity for young people to get into housing.
“Owning a house is a long-term investment, you’re not buying or building to sell it within a month,” she told the Brolga. “Economic circumstances will change over the length of time of your home ownership.”
King is also Minister for Infrastructure, Transport, Regional Development and Local Government
What is Help to Buy? Minister King discussed two government initiatives: the 5% Deposit Scheme and the Help to Buy Scheme. Litwin used Help to Buy, specifically, to purchase a plot of land to begin building her first home.
Quick catch up
5% Deposit Scheme: This reduces the minimum deposits for homebuyers to 5 percent if they haven't owned a home in the last 10 years, and 2 percent for single parents.
Traditionally, homebuyers with less than 20 percent of the property’s value saved required Lenders Mortgage Insurance, a large added cost to purchasing a home.
Help to Buy: This scheme means the government takes an equity stake in your home, in exchange for a smaller loan required.
What she said: Minister King said it’s important for people, particularly youth, to have a stable home to maintain security, a healthy work and social life.
“So many young people who are renting at the moment or continuing to live with their parents, or in fact actually we’ve got a number of young people that are homeless in our community,” King said. “So actually trying to provide that opportunity for them is really important.”
Local chat: Litwin used the Help to Buy scheme to purchase her land. She said it had been important for her to stay in Ballarat, close to her family.
“I’m really excited to have a place that I’m able to call home, to be out of the rental market and not have to move home all the time and be in control of my environment and where I’m living”.