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Single and Under 30? You’re a Likely Candidate For the 5% Deposit Scheme

July 14, 2022

Looks like single Australians under 30 take up the most spots in the federal government’s 5% deposit first home buyer scheme. Here’s how to secure one of the highly coveted 35,000 scheme spots released on July 1.

Long gone are the days when you had to pinch pennies to save for a 20% deposit to buy your first home (that’s so 2019).

Today, you can get onto the property market ladder with just a 5% deposit and pay no lenders’ mortgage insurance (LMI), thanks to the federal government’s First Home Guarantee (FHG) scheme.

NAB – which is one of two major lenders (alongside dozens of smaller players) that provides finance under the scheme – recently released some pretty interesting data on just who is nabbing the limited spots each year.

The data shows almost two-thirds of people (63%) who purchased a house under the scheme were single buyers – whereas for non-scheme purchases, single buyers only made up 49% of borrowers.

Of the single people snapping up First Home Guarantee spots, 59% were female and 41% were male.

Government data also shows that the median age of people getting into the scheme is 25 to 29 years old.

“People going at it alone shouldn’t be disadvantaged and we are seeing the scheme help them buy a property,” says NAB Executive Home Ownership, Andy Kerr.

Related articles:

How the scheme helped one homebuyer purchase 4 years sooner

First home buyers who use the scheme fast-track their property purchase by 4 to 4.5 years on average, because they don’t spend time trying to save up for the standard 20% deposit.

On top of that, not paying LMI can save you anywhere between $4,000 and $35,000, depending on the property price and your deposit amount.

This is exactly what helped car salesman Rihan Nasser purchase his villa unit last August.

Initially, Rihan had been crunching the numbers on what he’d need to do to save a 20% deposit, admitting “it would have taken him years”.

“The scheme fast-tracked the process by maybe two, three or four years and made it easier to come up with the deposit to buy,” says Rihan.

“Once I knew I needed 5%, I knuckled down on the saving. It took me about a year and a half. I would 100% recommend the scheme. It made it so much easier.”

How to start the process today

buying property with friends

Ok, so here’s the thing: places in the First Home Guarantee scheme are generally allocated on a first-come, first-served basis.

And don’t let this year’s expansion to 35,000 spots lull you into a sense of complacency – they’ll get snagged pretty quickly.

So if you’re a first home buyer looking to crack the property market sooner rather than later, contact Soho Home Loans today and we can explain the scheme to you in more detail, find out if you’re eligible, and then help you apply through a participating lender.

Need more financial advice? 

Browse our finance category. It’s chock full of hacks and advice from industry professionals. And remember to download the Soho app for quicker browsing and property matching. It’s getting you into your dream home faster!

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