The Regional Australia Institute (RAI) has welcomed the federal government’s action to address regional housing market issues through the ‘Regional First Home Buyer Guarantee’ (RFHBG).
The RAI’s 2021-22 housing research series, ‘Building the Good Life,’ identified widespread tightness in regional housing markets, the different types of regional housing markets and the key, place-based policy responses needed.
Research showed difficulties accessing finance constrained home sales and home building in many parts of regional Australia, and recommended a regional home loan guarantee to address the challenges.
The Regional Home Guarantee (RHG) scheme offers a boost to regional homebuyers and construction to generate more home building in areas outside capital cities.
RAI chief executive, Liz Ritchie, said the Regional First Home Buyer Guarantee was an extension of the government’s existing Home Guarantee Scheme and supported eligible applicants to buy a home in a regional area with a deposit of as little as five per cent.
The program is available to eligible Australians already working, contributing, and making a life in regional locations.
“Housing availability is now the biggest challenge holding back the potential of regional Australia,” Ms Ritchie said.
“We commend Federal Housing Minister Julie Collins for the specific recognition of the complexities of the regional housing market.”
RAI’s research found residents in at least 20 per cent of all regional Local Government Areas faced big barriers to accessing housing finance.
“City home buyers may require a 10 or 20 per cent deposit, whereas, in more remote regional markets, borrowers may need double that. This inequity has been a contributing factor to the underinvestment in new homes in our regions,” Ms Ritchie said.
“Assistance through the Regional First Home Buyer Guarantee program can assist prospective regional first-home buyers to avoid paying mortgage insurance – often a barrier to home affordability.”
The Regional First Home Buyer Guarantee began on Saturday (October 1). The National Housing Finance & Investment Corporation’s website will provide detailed information about the program’s eligibility.
