New research by NAB has revealed 40% of young Australians are considering buying a property with someone who is not a romantic partner.
The major bank’s survey of Aussies aged 18 to 29 showed that buying with another person, such as a friend, was at the top of the list when it comes getting a start in the property market, followed by dropping their price range. One in three said they would buy and rent the property out initially, while 20% were willing to move into a share house.
NAB executive, home ownership Andy Kerr (pictured above) said younger people were getting creative when it came to making their property dreams come true.
“Younger Australians aren’t letting meeting a partner or getting married later in life hold them back from owning a home now,” Kerr said.
“People are definitely looking at their options and casting the net wider when thinking about who they could buy with. Rentvesting – purchasing in one location and then renting in another – is another trend that is creeping up in popularity.”
The NAB research showed that 41% of those surveyed said the biggest compromise they were willing to make was the amount they’re willing to spend on the property, while 31% said they would trade off the size of the land, and 28% would give up their preferred location. One in 10 said they weren’t willing to budge at all on their wish list.
Kerr said the latest NAB data showed that first home buyers weren’t being deterred from entering the property market despite the market softening overall and rising cost-of-living.
“Buyers are just thinking outside of the box to make it happen,” he said.
Kerr said regardless of who you were buying with, it was important that all parties talked about how they would jointly save for a deposit, agree on the property and meet ongoing costs.
“As buying a home is the biggest purchase most of us will make, it’s also worth considering getting a solicitor involved for additional comfort,” he said.
“From our perspective, we can give confidence around getting a fast home loan approval. Around 50% of eligible NAB customers can now get a decision within 24 hours thanks to our simple home loans process. Around 30% of those are getting unconditional approval within an hour and some within 15 minutes – that’s faster than getting your internet set up in the new home.”
On Friday, RateCity.com.au revealed a ninth RBA OCR hike was a near certainty on February 7 as inflation reached 7.8% on Wednesday, its highest point in 33 years.
RateCity.com.au research director Sally Tindall said Australia had a serious inflation problem and it was not going away without a fight.
“With annual inflation now sitting at 7.8%, the RBA has little choice but to serve Australians with yet another cash rate hike,” Tindall said.
“Another 0.25 percentage point increase would mean the average borrower with a $500,000 debt before the hikes started in May last year could be looking at a total increase in their monthly repayments of $908 more a month.”
Chris Foster-Ramsay, Foster Ramsay Finance director said first-home buyers looking to get a loan or refinancing should put their finances in order before making a career change.
“It would be unwise to be looking for finance approval or to buy and purchase a home if you’re changing job roles in one way or another,” Foster-Ramsay said.
“Most majors (with the exception of ANZ) will take two to three pay cycles and an employment contract, ANZ still requires three months of salary credits. Where it becomes more of an issue is if your borrowing capacity is right at the top of the tree.”
