Yahoo Finance These first home buyers will soon get a boost
First home buyers in New South Wales could get onto the property ladder quicker, thanks to a new government scheme.
The NSW government has introduced legislation for a $780.4 million shared-equity scheme to parliament.
Under the proposed scheme, the government would contribute an equity share of up to 40 per cent for new homes and up to 30 per cent for existing homes purchased by eligible buyers.
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“Key workers, single parents and older singles will be able to have the security of home ownership with a lower upfront deposit, a smaller loan, lower repayments, no lenders mortgage insurance and no interest on the government’s equity share in a property,” Premier Dominic Perrottet said.
Key workers include teachers, nurses and police officers.
Prospective home buyers would need a deposit of at least 2 per cent of the purchase price.
Lenders mortgage insurance (which is usually charged on deposits under 20 per cent) would not apply.
Minister for Homes Anthony Roberts said the trial would help Aussies overcome the deposit barrier to home ownership.
“Under this scheme, buyers will borrow less for their home and lower their monthly mortgage repayments, making home ownership more affordable and easier to access for eligible people,” Roberts said.
“We’re addressing the barriers to home ownership for people facing the highest hurdles, to make owning your own property a reality for more people in NSW.”
How will the shared-equity scheme work?
The NSW government’s shared-equity scheme will be open to 3,000 people each year for two years.
It will be open to key workers, as well as singles over 50 years old and single parents with a child or children younger than under 18.
The maximum gross income will be $90,000 for singles and $120,000 for couples.
Property price caps will also apply.
The maximum value of the property that can be purchased under the scheme will be $950,000 in Sydney, the Central Coast, Illawarra, Lake Macquarie, Newcastle and the North Coast of NSW, and $600,000 in other parts of the state.
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