First-home buyer Ingrid Scott is in her early 20s and bought an apartment in Brunswick last year after saving since she graduated high school. Picture: Mark Stewart
More than half of Aussie buyers are setting strict budgets or seeking out savvy hacks to get their foot on the property ladder, but less are relying on the “bank of mum and dad” than reputation suggests.
Just 5 per cent of buyers used financial support from family members to purchase a home, while less than one in 10 are willing to give up socialising to save for a deposit, according to new exclusive Great Southern Bank research.
The Great Southern Bank Home Loaner Survey asked 1000 Australians who had recently bought or were actively looking to buy a property what type of home loaner they were, based on their saving tactics.
RELATED: Victoria’s hottest regional housing markets for demand, price growth
How to buy, sell and rent in uncertain Covid-19 lockdown era
Unit market a gateway into Melbourne’s top suburbs
No. 76 Liston Ave is attracting young buyers in Reservoir with its $700,000-$740,000 price tag.
It revealed the most common approach to saving was simply budgeting.
Sticking to a budget by keeping a weekly or monthly spreadsheet of expenses, opting for cost-effective lifestyle swaps such as taking public transport or choosing cheaper grocery alternatives were among the key tactics.
Great Southern Bank chief customer officer Megan Keleher said taking a proactive approach to saving was “a winning strategy” for first-home buyers.
“There is a general view that parents must be swooping in to help, but our research shows that, for most people, just setting savings and budgeting goals is the way to owning a home,” Ms Keleher said.
No. 210/33 James St, Prahran, is the perfect inner city pad for a solo buyer, priced at $429,900.
But 31 per cent of budding buyers were categorised as “savvy hackers” who were taking advantage of government grants, hunting down discounts, buying or selling second-hand items or starting up a “side hustle” to earn extra income.
More than half of these homeowners had used the First Home Buyers Deposit Scheme, with 19 per cent taking advantage of regional grants on offer.
Other home loaner types ranged from “long haulers” who had built up their deposit over several years and “home birds” who moved back in with their family to save.
Inside the two-bedroom apartment 52/9-19 Miller St, Fitzroy North.
Buyer’s advocate Emily Wallace said while lockdown had helped some first-home buyers save more, the post-lockdown property “madness” had also pushed prices beyond their budget.
She said most of her first-home buyer clients were between their late 20s and early 30s as it “probably takes 6 or 7 years to save on an average salary”.
Ms Wallace noted many young buyers were using their parents as a guarantor for their home loan, as opposed to receiving a direct handout.
Buyer’s advocate Emily Wallace said first-home buyers’ lockdown savings couldn’t keep up with the surging market prices.
No. 16 Frederick St, Thomastown, with a $525,000 price tag, could fit a budding buyer’s budget.
“It’s a really good, common way to get in with a smaller deposit. But there’s an equal amount of people who have saved on their own,” Ms Wallace said.
She also warned against chasing incentives like HomeBuilder or regional grants if it meant buying in an area “where you don’t want to end up” in the long run.
Ingrid Scott bought her first property in December last year after saving for her deposit since she was 18.
The 23-year-old said she began saving right after high school while she worked a casual retail job, even before she started full-time work last year.
Ingrid Scott said sticking to her budget and living with her parents helped her build her deposit. Picture: Mark Stewart
Ms Scott was able to buy a one-bedroom apartment on Sydney Road, Brunswick, by sticking to budgeting strategies while living at home with her parents.
“I was able to save half to three quarters of my weekly income and put it away in a locked account,” Ms Scott said.
“It was out of sight, out of mind. I still went out with friends and had my splurges, but the week after I would pull back on my spending to make up for it.”
She said she was “lucky” enough to have her deposit ready before the pandemic, and was able to snap up a property when there was “a real slump” in the apartment market due to vacancy rates.
Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest Victorian property market news delivered direct to your inbox.
READ MORE: Foreign buyers add $2bn to their spend on Aussie homes in 2019/20
The Wilds: Merri Creek, Northcote house project to open up water views
Paul Jennings’ former St Kilda pad for sale with new twist