This article is from the Australian Property Journal archive
THE Victorian government is introducing a new fund for homebuyers, a shared equity arrangement that aims to help thousands enter the housing market.
The $500 million Victorian Homebuyer Fund (VHF) will reduce the amount eligible participants need to buy their own home, requiring buyers to need just a 5% deposit with the government providing as much as 25% of the purchase price in exchange for an equivalent share in the property.
“It can take years to save for a deposit – through our Victorian Homebuyer Fund, more than 3,000 Victorians are expected to enter their own home sooner,” said Tim Pallas, treasurer.
Aboriginal and Torres Strait Islander homebuyers will need to provide a deposit as low as 3.5% and will receive as much as 35% of the purchase price for an equivalent share in the property.
Buyers can then buy out the government’s share in their property at market value, with these funds being reinvested for other homebuyers looking to enter the market.
“The pandemic has underscored the value of a secure, safe home to call your own – that’s what this program will provide for thousands of Victorians,” added Pallas.
The VHF, which is expected to support more than 3,000 Victorians, is an expansion of the $50 million HomesVic Shared Equity Initiative, introduced in 2020.
The HomesVic Intiative was a pilot program introduced by the government that helped more than 335 Victorians purchase their first home.
The new VHF will however be available to a wider range of Victorians, not just first home buyers, with homebuyers also being able to buy in more locations and have a higher income threshold.
“This will make it easier to secure your own home and we’re proud to play our part in helping Victorians realise this dream – because there’s no place like home and we want every Victorian to know that feeling,” said Pallas.
Participants will be able to buy in any location in Metropolitan Melbourne and various regional locations.
To be eligible, applicants will need to be over the age of 18, be an Australian citizen or permanent resident and not currently hold an interest in a property.
Additionally, the value of properties purchased may not exceed $950,000 for Metropolitan Melbourne and Geelong and $600,000 in Regional Victoria.
