New homebuyer support round opens

The government has opened the next round of its scheme to help first time homebuyers into a market that's still buoyant despite widespread economic pain.

First homebuyers will again be able to apply for substantial government support to help them into the market.

Hopeful homeowners can again access to tens of thousands of dollars in financial support to enter the market as the latest round of the first home buyers lenders scheme kicks off alongside federal and state stimulus.

Ten thousand additional spots within the federal government's First Home Buyer Lending Deposit Scheme openings were made available on Wednesday, offering those hoping to get on the property ladder a guarantee for a loan with little as 5 per cent of the purchase price as a deposit.

Under the first iteration of the scheme, 10,000 first home buyers bought within three months of approval despite a low stock levels, a market lockdown and a pandemic.

Many homebuyers fell well short of the prescribed income caps, with the average single earning $66,488 and couples making $109,410 ($200,000 cap). Round one funding was most popular with buyers under the age of 30 years who accounted for 59 per cent of the guarantees. Twelve per cent of guarantees were given to those over 40.

The scheme will work alongside the federal government’s coronavirus stimulus package, HomeBuilder, which will offer eligible homeowners building a new home $25,000. State based first home buyers grants and stamp duty exemptions can also be used alongside the program, offering $10,000 to $20,000 depending location.

The federal government’s bond aggregator, the National Housing Finance and Investment Corporation (NHFIC) is again tasked with delivering the scheme. Chief executive Nathan Dal Bon expects competition for a place in the scheme to be strong.

“To date we’ve seen widespread appeal of the scheme across all states and territories, including regional and metro areas,” Mr Dal Bon said.

“Notwithstanding the current challenges posed by COVID-19, we anticipate that there will be continued demand for these new 10,000 places.”

Strict criteria will be used to assess eligibility for the scheme, including income caps of $125,000 for singles and $200,000 for couple, s and purchase limits depending on the local market.

Specific lenders are allowed to administer the scheme, with Commonwealth Bank and NAB offering 5,000 spots and a further 27 smaller lenders handling the remaining half.

To reserve a place within this financial year’s intake, applicants must file a tax return to prove their income and meet their preferred lenders initial lending criteria. Approved applicants will then have 90 days to sign a contract on a new or established home.

The property industry has fared well against the economic downturn caused by coronavirus, with prices holding well over the quarter. Buyers buoyed the market in the face of the low stock levels as first home buyers and renovators looked to take advantage of the stimulus on offer, said Commonwealth Bank group executive Angus Sullivan.

“Across the business recently, we’ve seen a great deal of interest from first homebuyers and renovators in new loans and top-ups which correlates with the resilience we are seeing in the broader housing market,” Mr Sullivan said.

“We expect demand for places to be similar to when the scheme first launched and it’s exciting that with more places now available we can help even more Australians into their first home sooner.”