Owning a brand new family home was a reality that Victorian parents Sonia and Jake McGuiness thought they would never realise for their blended family of four.
But the engaged couple are among thousands of Australians to achieve the dream of home ownership thanks to the federal government’s recently introduced Help to Buy scheme.
Under the Help to Buy scheme, the government chips in with part of the cost of a home, so you need a smaller deposit and loan, but the government owns an equity share that you repay when you sell or buy them out.
Since the scheme started in December, the scheme has already approved more than 3,500 places.
The McGuinness family, which includes 11-year-old Charlotte and one-year-old Logan, had been living in “rental after rental” when they heard about the scheme and decided to apply.
“We were really struggling, because nothing that we could afford was anywhere near my stepdaughter, and it was really hard,” the mother of two said.
An early inheritance from her terminally ill mother also helped the couple pull together a deposit for a four-bedroom home in Melbourne's south-east for just over $800,000.
“She said ‘I am not going to give you an inheritance after I die, I want you to get a house’,” she said.
The McGuiness family at their new home in Melbourne. Picture: Supplied
“My mum, there's a timer on her life. We come from a very ‘You've got to have a house. You've got to have stability for your kids’ family.”
Owning a home where both children have a bedroom to call their own, a study for Jake, and added extras like solar panels and refrigerated air-conditioning, were elements of home ownership which she said she did not take for granted.
“It's got everything that we wanted,” she said.
“We're in an estate that's really eco-friendly and we've got everything already put in, and it's brand new as well. They built it and sold it straight away.
“One thing I always wanted was with my son, to do the etching to see his height on the door and I could never do that, and this is something I could do.”
The national median home price increased 9.1% to $897,000 during the year to February. Picture: Getty
Help to Buy not only bridged the affordability gap enabling the family to buy where they needed to live, it has meant they now live close to Charlotte’s mother’s home, as well as Sonia’s workplace.
It has also taken away the stress of living as tenants.
“It’s a sigh of relief as we were always so on edge to make sure the house is perfect because ‘what if they kick us out? Or ‘what if we damage something?’ and we can’t afford to fix it,” she said.
Getting onto the property ladder
The Help to Buy scheme has been up and running for about three months, and just over 1,000 home buyers have already settled on their purchase, while nearly 2,500 successful applicants prepare to buy.
Nearly three in four Help to Buy applicants have been single so far, including 10% who were single parents, showing how the scheme has helped home buyers who often face problems entering the housing market.
Federal housing minister Clare O'Neil says the program is already helping Australians who have been locked out of the property market. Picture: Supplied
It’s also been shown to support Australians with smaller savings taking the first step into home ownership, with the median deposit at just $29,000.
Federal Housing Minister Clare O’Neil said the program was already helping to break down barriers to home ownership for Australians who had been locked out of the market.
"Labor believes that all Australians should have the chance to buy their own home, and Help to Buy is on the way to making that a reality for thousands of people on lower and modest incomes," she said.
"Help to Buy is giving hope to so many Australians who had given up on homeownership, by helping them get a foot in the door of their own home.
"The number of single parents and applicants getting into their own homes is a real point of pride and vindicates why we fought so hard against the Greens and the Coalition to get this program up and running."
Homeownership rates in Australia have been falling among young households for decades. Picture: Getty
While the scheme has helped thousands of Australians get into the housing market sooner, critics say the scheme may have brought forward demand and contributed to rising home prices.
The national median home price increased 9.1% to $897,000 during the year to February, adding around $90,000 to the value of the median home, according to PropTrack’s latest Home Price Index.
Experts say other factors have also contributed to increased demand, including last year’s three interest rate cuts and the government’s expanded 5% deposit scheme.
Homeownership rates in Australia have been falling among young households for decades, according to PropTrack research.
Three quarters of households born in the 1940s and 1950s were homeowners before they reached 40 years old, however the generation born in the early-to-mid-1980s - the most recent cohort to reach this age – has seen just under 60% have moved into homeownership.
The Help to Buy shared equity scheme sees the government contribute up to 40% of the purchase price for new homes or 30% for existing homes in exchange for a share in the property.
Over time, the buyer will need to repay the government's share in the property, either in increments or when the property is sold.
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