Home buying advice: How to maximise Government schemes to reach your property goals sooner

It’s not just first homebuyers that can take advantage of government grants to get a new place of their own but you need to understand what’s on offer, how and where.

Second-home buyers on a budget should take advantage of government schemes and seek advice to get the most out of their money, industry experts say.

But with requirements that differ between states and territories and general market prices, it can be hard to get ahead. So, where do you start?

Make a plan

Buying a house the second time around can be very different than the first time you bought, especially if you’ve been out of the market for years.

According to Amy Lunardi Property founder and buyer’s agent Amy Lunardi, it’s “never too early to work with a mortgage broker to put a plan in place”.

From understanding borrowing capacity to concessions and government schemes, a broker can help buyers determine how and when purchasing a second property might be possible.

They can also advise if it’s best to buy or sell first, and whether this will impact any potential concessions buyers may apply for.

Mortgage Choice Merimbula broker Jen Hughes said this was especially important for buyers who have been out of the market for a period of time.

“Everyone’s circumstances are very different, and even if you’ve bought a home before … every time you do it, it’s different,” Ms Hughes said.

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Boost your purchasing power

federal government’s proposed Help to Buy scheme will allow buyers to purchase a home with only a 2 per cent deposit. Picture: iStock

Perhaps the biggest aid for second-home buyers was being aware of schemes and incentives that could bolster their borrowing or purchasing power, Ms Lunardi said.

The federal government’s proposed Help to Buy scheme will allow buyers to purchase a home with only a 2 per cent deposit, with an equity contribution of up to 30 per cent for an existing home and up to 40 per cent for a new home from the government.

Meanwhile, the Family Home Guarantee allows single parents to purchase a home with a 2 per cent deposit without paying lenders mortgage insurance (LMI).

The Labor government also recently announced an expansion to the First Home Buyer Guarantee to enable buyers who haven’t owned a property in the last 10 years — such as second-home buyers — to get back in.

All federal schemes will also be opened up to permanent residents, not just Australian citizens.

However, Ms Lunardi warned there was often a strict criteria buyers had to meet, including property price caps, salary caps and occupancy rules.

These requirements can differ between states and territories.

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Ms Lunardi said the Victorian Homebuyer Fund was a prime example of a scheme that could help second-home buyers get ahead.

“You can get a deposit for as little as 5 per cent, and then the government will contribute up to 25 per cent,” Ms Lunardi explained.

“It means that the government is a co-owner of your property — they share a portion and contribute to your deposit.”

She said the boost could mean “your mortgage is much more affordable, and the interest you pay is lower”.

Ms Hughes added that some lenders offered their own incentives too.

“Banks are always offering little incentives to people to try and bring them in,” she said.

She added that given the current market, some second-home buyers were also turning to family members for help in undertaking a guarantor role.

“People don’t talk about it much but you can get a family member to guarantee your purchase and I’m seeing a lot more people do that,” Ms Hughes said.

“All it’s really doing is giving you more equity and lowering the risk to the bank.”

Market knowledge

Second-home buyers are also turning to family members for help in undertaking a guarantor role.

Like any property purchase, keeping abreast of the current climate and understanding the general market is key.

Ms Lunardi said in Victoria, areas like Melbourne’s north, as well as Geelong and Ballarat, and similar hubs in other states, were still offering second-home buyers greater balance and affordability.

“Look for those areas that give you a fantastic lifestyle, great amenity, good schools and employment opportunities but where you can still access properties at a relative price point,” Ms Lunardi said.

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