More Australians team up with friends or family to overcome deposit hurdles
Joint home loans involving friends or family members have increased by more than 33% over the past year, according to new data from NAB.
The most significant growth has been recorded in Victoria (up 47%), South Australia (up 37%), and New South Wales (up 34%).
According to Felix Sekulla, home lending executive at NAB, improved market confidence and lower rates are encouraging more buyers to return.
“For several years, higher interest rates kept many would-be buyers on the sidelines,” Sekulla said. “With confidence in the market improving, helped in part by lower rates and more support available through various first-home buyer schemes, many Australians are back looking for their dream home.
“Buying with someone you trust, such as a close friend or family member, might not be the right strategy for everyone; but for many, this allows them to buy sooner, or buy in an area they might not be able to afford on their own.”
NAB’s data suggests that first-home buyers are exploring a range of approaches to achieve homeownership. Some are choosing to rent in their preferred location while purchasing in a more affordable area, a strategy known as rentvesting. Many are broadening their search, considering townhouses instead of standalone houses or looking at different suburbs to find better value; while a rising number of buyers are joining forces with family or friends to share financial responsibilities and enter the market sooner.
Among those who have recently purchased together are siblings Ellie and Logan (pictured top). After saving for a deposit while living with their parents, they decided to combine their resources to buy a home sooner than they could have managed individually.
Their search began around Easter, and after viewing several properties, they chose a four-bedroom house in Leopold, close to their grandfather’s home. After collecting the keys, the siblings placed their mattresses on the floor, ordered pizza, and spent their first evening as homeowners. “We were just excited to be homeowners,” Ellie said.
Unfamiliar with the homebuying process, they relied on family advice and online research before consulting a home loan specialist. Through this process, they learned they were eligible for the government’s 5% Deposit Scheme.
“When it happens, it happens quickly,” Logan said. “We signed the contracts in May, and the keys were unlocking the door by mid-June.”
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