Good News for Low-Income Homebuyers, WA Adopts a New Loan Scheme
Buying a home seems a bit difficult task when you have a low income. But there is a good news for Low-income Western Australian homebuyers. They can now make a property purchase by sharing 30% of the capital with the Department of Housing and borrow the balance through state lender KeyStart Home Loans.
As per the Property Observer report, there is an option named SharedStart loan in the shared equity model “Shared Home Ownership” that benefits for homeowners who finds difficulty in affording properties due to rising prices.
With this scheme, homebuyers are encouraged to purchase the department’s share to make their dream of full home ownership come true. This is because the ownership model is not similar to others where the government retains a permanent interest in the property.
Adrian Warner, acting director of strategy and policy at the Department of Housing said – One reason for its development was to overcome the rising demand of affordable housing as rents were becoming too expensive in Western Australia.
He stated, “In the March quarter of 2014, the median rent reached $460 in Perth, while the median house price increased to $540,000, up from $525,000 in the previous quarter”.
Till date, this system delivered home ownership to more than 700 low-income households. This homeownership program, however, is not relevant to the lowest socio-economic groups because it still depend on buyer with regular income to pay off the mortgage.