There is a lack of knowledge among first home buyers about grants and schemes available to them, particularly those who do not use a mortgage broker, research has shown.
Research commissioned by major mortgage brokerage Aussie found that one-third of first home buyers (FHB) are still unaware of the various federal and state government grants and schemes encouraging them to enter the property market.
The research of more than 1,000 FHBs found that 85 per cent do not know the nature of the First Home Loan Deposit Scheme (FHLDS), which means they are unaware of whether it could help them access the mortgage market.
It also found that 32 per cent of those interviewed do not understand the First Home Owner grant, the $25,000 HomeBuilder grant, the FHLDS or any other government or state home initiative.
Aussie CEO James Symond said the majority of FHBs are unaware of the opportunities available to them through these grants and schemes.
“It appears there is widespread confusion and a lack of knowledge about government grants and schemes among first home buyers, particularly those who are not being advised by a mortgage broker,” Mr Symond said.
He added that recent Aussie data has shown that FHB enquiries have more than doubled, compared with the same time last year, and said they are currently at an all-time high.
“We are receiving record levels of enquiries from first home buyers to explain and help them access the various schemes, as well as presenting home loan options,” Mr Symond said.
Google search volumes have also shown that first home owner enquiries have reached record levels, in the wake of record-low interest rates, government schemes and competitive lender offers.
“The high level of demand has surprised us during these difficult times, as has the lack of knowledge about the incentives to get first home buyers into what is Australia’s largest asset class,” Mr Symond said.
“The various schemes’ application and the home loan process itself can be complex, especially as they come with strict eligibility requirements and conditions, which many first home buyers simply cannot navigate on their own.”
FHB use of brokers dips
The percentage of FHBs intending to use a broker to help them enter the property market has reduced since January, from 75 per cent to 67 per cent in June.
This is compared with 47 per cent of the general population who intend to use a broker to reach their property goals.
FHBs are also far more likely to want more financial guidance than the average Australian, with 84 per cent of FHB willing to seek professional assistance, compared with 51 per cent of the general population.
Meanwhile, nearly half, or 46 per cent of FHBs want more guidance on saving for a home loan deposit.
Three in 10 FHBs want assurance from a professional that they are doing the right thing, and expert information around their personal finances.
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Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.
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