House prices are increasing all over the country, yet Western Australia remains affordable for buyers looking to purchase their first home. According to Aussie Home Loans, first home buyers in WA represent 16 per cent of the entire home loan market, compared with only 13 per cent in Victoria and Tasmania and two per cent in New South Wales and the ACT.
This is due to the fact that Perth is still more affordable compared to other city capitals. Median house and unit prices in Perth are at $520,000 and $415,000, respectively, compared to Sydney's median house price of $1,013,000 and Melbourne's $719,000.
"First home buyers are facing challenges across the country. Our most positive growth is coming from WA," Aussie chief executive James Symond said. "WA presents solid buying opportunities."
But affordability is not the only issue for first home buyers. Symond emphasised that buyers still need to compromise to enter the housing market due to tougher lender guidelines and criteria. This often meant compromising on the size and location of a potential first home, as houses close to Perth have become less affordable in the past five years.
In fact, first home buyers who want to buy a house under $500,000 need to buy more than 25 kilometers from the city. This has driven first home buyers to settle for units or townhouses, which can still be found about 10 to 15 kilometers from the city.
With interest rates now at a historic law, Symond said buyers should be able to afford repayments if ever they rise in the future. It is also important to seek advice from a professional mortgage broker in order to understand different mortgage products.
It can be confusing to know whether to get a variable rate or fixed rate mortgage, and what features are important. That's why it's important to not only check the right rates, but make sure that you're getting the right features in your home loan. Get help choosing the right home loan