First home buyers grant yields home loan surge

Published: January 12, 2009 - 09:32 PM

The Age has reported that the Government's initiative to increase the first home buyers grant for old homes to $14,000 and to $21,000 for new builds has flowed through to an increase in mortgage applications.

Figures just out, show that in November when the grants were increased, home loan applications for first home buyers increased by 18% and first home buyers now have the highest share of the market for 7 years.

The combination of interest rate cuts coupled with the increase in the grants has made the market much more accessible for people looking to buy their first home.

Whilst cheaper interest rates are great news for home buyers and homeowners looking to refinance their debt, the economic crisis has also meant that lenders are tightening their application criteria.

Alison Walter of ShopAround.com.au said that "Home owners looking for a new home loan should do all they can to ensure they are getting the best home loan possible. It is worth taking the time to compare interest rates and compare mortgages and home loans on offer from lenders. There are savings to be made with cheaper interest rates available but it's up to those wanting a mortgage to compare interest rates and home loans themselves. If home owners want to make the choice to go and switch mortgage providers now is a great time to do it."

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