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SINGLES SQUEEZED OUT OF THE PROPERTY MARKET

Announcement posted by Smartline 15 May 2017

The latest research from ME Bank shows that housing affordability is proving more difficult for single people than ever before.

The latest research from ME Bank shows that housing affordability is proving more difficult for single people than ever before.


The percentage of loan applications received by the bank dropped nine percentage points since 2015 – meaning more singles are being excluded by affordability issues in the property market.


Women have it tougher than men. Single female home loan applications fell 14 percentage points in the same period.


Principle of Smartline Rockingham Mortgage Advisers, Justin Smith, said that singles should still try to enter the market when they have saved a deposit:


“We’re seeing some green shoots in the Rockingham property market. Most real estate experts are saying that we’ve reached the bottom of the market. For singles, this means now is the best time to look to buy a property either as a primary residence or an investment.”


Smith also said that capital growth can come from entering the market at the right time.


“What we’ve seen historically is that timing can be crucial to maximise profit. Giving the market a few years to recover can mean losses up to hundreds of thousands of dollars. While it’s impossible to predict the right moment to buy, we encourage buyers to look at overall trends, and to take action when that trend starts to move,” he said.


Is there any good news for singles? Yes. While some areas of Western Australia are starting to experience strong price growth, others remain very affordable.


Smart buys are possible in Rockingham without breaking the bank. For single people on an average income, there are many units and townhouses on the market that are very much within an affordable range, either as a primary residence or as an investment.


Lenders are also encouraging singles to team up with their parents or another friend or family member as a way to get into the property market. 12% of Western Australia’s first home buyers receive financial help from their parents.


Parental guarantee arrangements mean that parents can use their own property to guarantee their child’s loan. These guarantees mean that singles can avoid extra charges like Lenders Mortgage Insurance.


As long as your income is sufficient and you don’t try to borrow an excessive amount of money, single people should still be able to comfortably make repayments on a loan.


Consulting your mortgage broker will help make sure you have the right home loan for you. This will also save you money in the long run, meaning you can pay off your loan sooner.