Last week, the 5% down payment plan has passed the parliamentary review, which means that the first home loan down payment plan has been finalized and will take effect on January 1 next year and will be funded by the National Housing Finance and Investment Corporation with a grant of A$500 million.
According to the Domain website, the data shows that the number of first-time home buyers who plan to buy a house is more than 100,000 per year, but the government will only provide 10,000 guarantees. Field economist Trent Wiltshire pointed out that as of August this year, there were 108,000 first-time home buyers in Australia in the past year, and as housing prices rebounded, more people are eager to enter the housing market. In addition to the low down payment, the program can also help lenders save 10,000 yuan in loan insurance premiums. After the government’s new plan, LMI insurance premiums are waived. If the loan is for a 30-year period, the LMI insurance premium is approximately $12,279. In addition, the New Deal coexists with other existing first home purchase offers. For example, to purchase a set of 649 million Australian dollars, the buyer only needs to pay a minimum of 32,450 Australian dollars, saving 12,279 Australian dollars in mortgage insurance and stamp duty free.
Coates is actually a bit worried about the 5% down payment plan, as strong demand is likely to lure the government to expand its quota, which is likely to be counterproductive, pushing up house prices, benefiting sellers and damaging first home buyers. Finance Minister Josh Frydenberg said that the price ceiling for the property varies by region and the details of the plan will be announced soon.
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