How to fast-track a home deposit
FIRST home buyers are set to benefit from better conditions in 2018 but saving tens of thousands of dollars for a deposit remains daunting for most.
The job of fast-tracking deposits often falls to family members willing to help out financially, as well as some strict saving strategies.
Realestate.com.au chief economist Nerida Conisbee said the latestl housing finance data showed a pick-up in first homebuyer activity.
She said first homebuyer incentives had improved, and investors were pulling back from their exuberance of recent years, which was opening the door for more first home buyers.
"Investors and first home buyers typically target the same sorts of property, similar price points in similar areas," she said.
Ms Conisbee said savers could speed up their deposits by keeping a closer eye on their spending, understanding what government assistance was available, boosting earning potential with a second job, exploring parent guarantor loans and considering mortgage loss insurance to reduce the required deposit.
Orium Finance senior finance consultant Thomas Patrk said parents' help was the most popular way to fast track deposits.
"This usually takes place via a gift or through parents using equity in their home to guarantee the deposit amount," he said.
"We've noticed a lot of families hold the majority of their wealth in their residential homes. Accessing some of this equity to help a child or family member get a foothold on the property ladder seems to make sense from a financial and emotional perspective."
Mr Patrk said other ways to fast-track a deposit included:
• Pooling funds between friends or family members;
• Using various state government incentives;
• Checking whether your bank offered special terms for qualified professionals.
Harry Aznavoorian, 27, recently bought his first home with the help of a financial gift from his parents. "I firmly believe that to be the only way to make this happen for most of us," he said.
Mr Aznavoorian said it was "close to impossible" for a young person to save a deposit on their own, and required a lot of discipline and lifestyle sacrifices.
"You also have to leverage every government option you can, first home buyers (grants), superannuation sacrifice, black magic, anything that can help," he said.
"In my opinion the most important things are do your homework, save money, ask for help and make sure that you aren't crippling your ability to live your life just to save. Equity is nice but so is having fun."