An incredible opportunity was recently unveiled by the South Australian government to improve housing affordability and availability, and could help you turn your homeownership dreams into reality sooner than expected.
Paving your way to step into your first home with just a fraction of the deposit can seem too good to be true, but Senior brokers Thuy Nguyen and Kristin Tunbridge are here to guide you through the numbers, eligibility requirements and things to consider so you can make the most out of this incredible opportunity.
Who is eligible for the 2% Deposit Home Loan Scheme?
The first question you’ll want to consider is, what criteria must I meet to be eligible for the 2% deposit scheme?
If you’re an Australian citizen, a permanent resident, or a New Zealand citizen on a special visa, then you’re in luck! You’re eligible to apply for this scheme.
You’ll also want to make sure you are:
- a first-home buyer wanting to live in the property itself
- looking to buy in Metro Adelaide or specific designated regional areas
Depending on the type of property or package you are after, additional requirements might come into play:
- having a Certificate III or higher will be required if you are looking to purchase an established home, but
- you can get away with not having one if getting a house and land package to build with participating partner builders is appealing to you.
What partner builders participate in the 2% deposit home loan scheme?
It’s important to note that not all lenders offer the 2% deposit scheme (more on this below!).
Due to this, the best way to find the right partner builder to support you in this journey is by working closely with your dedicated Rise High Broker.
As the experts supporting and empowering you, we are always looking to keep your best interests at heart and can simplify the process by filtering through all partners to provide tailored advice to your unique circumstances.
During our free consultations, we will help you identify clear short and long-term goals, which will ultimately help us guide you towards the right team of professionals who can support you best under this scheme.
Can I buy a house with $10,000?
Depending on the value and type of property you are looking at, getting into your own home with as little as $10,000 may be a possibility.
As a first-home buyer, you may also be eligible for additional help schemes such as Stamp Duty reliefs, First Home Owner Grants (FHOG) and special savings on Lender Mortgage Insurance (LMI).
Assuming you are eligible for these grants and contributions, are considering a house and land package for $550,000 or under and will be working with participating partner builders, you could indeed enter the market with as little as $10,000.
However, we highly encourage you to discuss this first with your Rise High broker. Since each scenario is unique and factors like your borrowing capacity and serviceability (ability to repay the loan), will also impact minimum deposit requirements.
What is the lowest deposit you need to buy a house?
With this scheme you would be able to buy your first home with as little 2% deposit ($10,000 in the hypothetical scenario we discussed before), however, if you were not eligible for the scheme you could expect to pay anywhere between 10% and 20% deposit to get you started.
If we take a look at the same price; $550,000 land and house package, and assume no Stamp Duty relief, First Home Owners Grants or Lenders Mortgage Insurance waivers are applicable, you could be looking at a minimum deposit of over $40,000!
Making this opportunity a clear game-changer when getting your foot in the door!
Are there any “catches” I should look out for with the 2% deposit home loan scheme?
We understand that navigating through the eligibility criteria and requirements might seem daunting, and an opportunity that sounds this good can often be too good to be true!
At Rise High, we love sharing our expertise with our clients and are always here to help. These are the things you should keep in mind when looking to apply for this scheme:
- Not all lenders in SA can provide you access to this opportunity: Working with your Rise High broker will help you get clarity on those that do!
- Interest rates are different: Though this opportunity can be a great starting point, these loan schemes do attract higher interest rates that major banks often have on offer. We’d love to work with you closely to assess whether paying this premium is worth the cost for your unique circumstances
- Only specific partner builders can support you: If you are looking to build, you must keep in mind that not all builders can support you under this scheme. A select few will make you eligible.
- There may be additional fees: Even if you are eligible for the 2% deposit home loan scheme, you may not be eligible for other waivers and initiatives such as the Stamp Duty relief. Gaining clarity on additional fees you may need to cover will help you get a clearer picture of the total upfront cost of your new home
- Grant and scheme eligibility: additional grants and schemes like the FHOG or stamp duty relief, come with their own set of selection criteria. To remain eligible for these, you must also ensure your total land and build cost remains under $650K.
Don’t Let This Opportunity Slip Away!
At Rise High, we understand that navigating through the eligibility criteria and requirements might seem daunting. But fear not! Our team of expert brokers is here to assist you every step of the way; from assessing your eligibility to guiding you through the application process. We’ve got you covered!
Can you picture yourself a year from now celebrating the progress on your very own home? We’d much rather celebrate this new and exciting milestone with you, than see you continue fretting over rising rental costs!
Don’t let the moving finish lines hold you back any longer! With the 2% deposit home loan scheme, your journey to owning your new Adelaide home just got a whole lot easier.
Reach out to our team today, and let’s embark on this exciting journey together!
