So you’ve been saving for a home deposit like a boss and owning your own home has been a dream for a while now. But now, the media is constantly posting about the cost of living, interest rates and the rest – and it has got you feeling a little nervous. Don’t let the doom and gloom crush your new home dreams. Let’s take a step back and look at the big picture – because it’s brighter than you might think.
Deloitte Access Economics recently undertook a comparative analysis of the cost of living in Perth with other major capital cities including Sydney, Melbourne and Brisbane. Here’s what the report found:
- The cost of living in Perth is the lowest of the major capital cities.
- WA has the most affordable housing and lowest mortgage repayments, as well as the highest median household incomes.
- Other non-housing living costs, such as food, recreation and transport, are also lower than the other cities.
Former Premier Mark McGowan (aka. State Daddy 😍) said “Western Australians enjoy some of the highest median household incomes in the country, and most affordable cost of living, particularly for housing and mortgage repayments, and other day-to-day expenditures. #winning
So let’s take a look at why now is still a great time to build your new home.
- Reframe the interest rate hype. Interest rates are still very low. Based on the latest RBA predictions, the cash rate in Australia is expected to climb to a peak of around 2.5% in coming months. Whilst that seems like a lot, compared to the 90s at 17%, it’s a cakewalk. Historically, interest rates have always floated around 6% – 10%. So, knowing that rates will rise, buy a home that doesn’t stretch you to your limits. This will ensure wriggle room for future interest rate rises. This is something our finance team 🤓 can help you with.
- Your borrowing capacity is best right now. When there are interest rate rises, lenders often increase their serviceability rates meaning your borrowing capacity may reduce with this and future increases. So if you feel that you are in a position to buy a home, it may pay to get in now before your borrowing power potentially decreases. Why not check out how much you can borrow calculator and find out what your repayments may be at the current interest rate.
- Renting is exxy and unstable. Due to the current housing shortage, it’s likely that rent prices will continue to increase. Why not see what you could afford with the rent you are currently spending?
- The government is offering help, so, uh, grab it?! The State and Federal governments currently provide a number of awesome options for first home buyers to build their own home, such as the FHOG, First Home Loan Deposit Scheme, First Home Super Saver Scheme and Keystart – get on board! 💸
- Property is swings and roundabouts, not cliff edges. The property market is cyclical. The Perth market consists of four stages; prices rise, fall, stabilise and rise again. If you’re buying your first home, you can’t always time it perfectly but knowing that it’ll all cycle back around, taking the plunge doesn’t seem so daunting.
- Building with Easystart means your build will happen. We’re sure you’ve seen the home building horror stories in the current Perth market. It’s a wild, wild jungle out there rn – but we pride ourselves on our transparent and straightforward building process AND our Price Hold Guarantee. We can’t wait to get you into your new home, ASAP!
So let’s keep a little perspective amongst the media hype. Bottom line is: Perth is one of the most affordable places to live and own a home. Keep moving forward with your new home goals! 👊 We got you.
Want to know more or see if you could afford to get a home of your own? Flick us your details below or try our finance health check.