The Victorian Government has launched a massive $500 million Homebuyers Fund for first time home buyers, and if you currently live in Australia’s most densely populated state, this could very well change your plans for the future.
Whenever changes occur in the world of property ownership, it can be very easy to just roll your eyes and say: “well, this doesn’t affect me so I guess I won’t bother having to understand it.”
The thing is though, these changes can massively impact our near future, and it’s good to understand them all now before we jump into the property market. Hell, some of us are already looking to buy our first homes, and we know it’s brutal out here.
Alas, the Victorian Gov knows this and is here to help, with a fund of $500 million dollarydoos now put in place to contribute 25% to a first home buyer’s house deposit. It bloody rocks. Here’s how it works.
“Most first home buyers can’t just rely on the bank of Mum and Dad for help,” wrote Premier Dan Andrews on Facebook.
“And if you’re a young buyer without a giant income, affording a home can feel impossible.”
So, essentially, recipients of the 25% chip in will need to put a 5% deposit in first, and then they can receive the Gov’s helping hand. Recipients can not already own a property (thank the lord).
The VIC gov will keep a stake in the home, but this ends once the owner buys them out or just sells the property. In the case of the latter, the VIC gov will get a chunk of money equal to what they put in.
State Treasurer Tim Pallas reckons that 3,000 Victorian residents will be helped out by the $500 million fund, but if you miss out, fear not. According to Pallas, once a recipient pays the VIC gov back their share, the money goes straight back into the fund to help someone else.
“We will put that money back into the fund, so this will become self-sustaining in all likelihood, given the continuing and historical appreciation and value of assets over time,” he said.
“We’re not putting more money into people’s pockets… we’re giving them the opportunity to participate in a competitive market.”
And a competitive market it is. According to The Guardian, the median price of a house in Melbourne is somewhere around $895,000, which is a lot of pocket change.
As a non-Victorian, I guess I should start saving now to maybe get a house in my 40s.