A new Labor government: what’s the impact on property investment?
With a change of government, comes a change of leadership and policies. Some say change is as good as a holiday, but what does this change actually mean for you, your properties, and your desire to purchase a home?
Perhaps one of the most hotly debated topics surrounding this election campaign was the rising cost of living, and consequently, the affordability of housing in Australia.
With many looking to migrate to Australia now the borders are open, the pressure on property supply is beginning to push prices even higher. In response to this, the Labor government announced a new policy to help ease the pressure on many Australian families looking to purchase a home.
So, understanding the new policy and the impact it may have on you when it comes time to invest or purchase your first home is an important step towards safeguarding your future.
So what is Labor’s new property scheme?
The Labor government announced a ‘Shared Ownership Scheme’, which they are calling ‘Help to Buy’ to address property affordability. Essentially, this scheme proposes that the government will become a co-owner of a property, contributing up to 40% of the price for a new home and 30% for an existing home.
Pretty generous, right?
However, as with anything, there are strict rules and eligibility requirements that surround this scheme. So, qualifying for this scheme may be a difficult feat.
To qualify you’ll need to:
- Have a 2% deposit
- Qualify for a loan with a bank or lending institution for the remaining amount
- Have a taxable income of up to $90,000 for individuals, and $120,000 for couples
- Not be a current homeowner
- Be an Australian citizen over 18 years old
This scheme will be available to 10,000 buyers per year and, while it has been announced, it hasn’t come into effect yet.
Will this new scheme impact the property market?
The cost of housing has been steadily increasing month-by-month for the last year due to many factors.
While this scheme aims to assist many Australians in their quest to purchase their first home, it doesn’t necessarily address the property price bubble we find ourselves in here in Australia.
In fact, some have suggested that it may even push property prices higher in the short term.
To find out more about getting into the property market, schedule a discovery session.
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