Smart planning needed and government incentives available to help you step into the property market

West Australian

25-05-2025

While strong price growth over the past couple of years has made buying your first home more challenging, Real Estate Institute of Western Australia (REIWA) President Suzanne Brown said it was still achievable but might require some compromises.
'First homebuyers remain very active in the WA market, with data from the Australian Bureau of Statistics showing first-time homeowners made up 37.7 per cent of all owner-occupier loans in 2024,' she said.
'However, many have had to reassess their expectations, potentially shifting their focus from houses to more affordable options like units, villas or townhouses to get into the market.
'They're also needing to broaden their search to suburbs further from the Perth CBD, where prices tend to be lower.
'Currently, suburbs in Perth's south-east and south-west, along with Midland to the east, are the most affordable suburbs for houses.
'For people looking to be closer to the city, units in Wembley and Bayswater offer affordable opportunities.'
Ms Brown encouraged first homebuyers to do their research thoroughly and to not be deterred by median house prices when considering where to buy.
'It is important to remember the median is the middle, and 50 per cent of sales will be below this price,' she said.
'There will still be affordable options in many suburbs – it may just take time and patience to find them in some areas.
'If your preferred suburb is out of your price range, look at neighbouring areas, which are sometimes called bridesmaid suburbs.
'They will be close to the same amenities you find desirable but are usually more affordable.
'I also remind first homebuyers their first house is often a stepping stone along the homeownership path not the final destination.
'Buy what you can afford, pay down the mortgage, and build some equity and upgrade later.'
Ms Brown said saving a deposit was one of the greatest challenges facing first homebuyers, particularly in a climate of rising prices.
She encouraged them to start saving as soon as possible and to make use of government schemes to help them build a deposit and get a loan.
'The Federal Government's first home super saver scheme lets first homebuyers save a deposit through their superannuation,' Ms Brown said.
'You can apply to withdraw a maximum of $15,000 of your voluntary superannuation contributions from any one financial year to buy your first home.
'Across all years, the maximum amount you can withdraw is $50,000 of personal contributions, plus earnings.
'First homebuyers should also know you don't need to have a 20 per cent deposit to get a loan.
'However, if you have less than 20 per cent, you will have to pay lenders mortgage insurance (LMI).'
Ms Brown said there were further government schemes addressing this.
'Keystart is a State Government initiative allowing eligible buyers to get a loan with as little as a two per cent deposit and pay no LMI,' she said.
'The Federal Government's First Home Guarantee scheme allows eligible buyers to access a loan with a five per cent deposit.
'The government guarantees the remaining 15 per cent, negating the requirement for LMI.
'The Federal Government is also expected to launch its Help to Buy shared equity scheme later this year.
'It will allow buyers to benefit from a smaller mortgage and lower repayments, with the government taking an equity share of up to 40 per cent of the purchase price of new homes and 30 per cent of the purchase price of existing homes.'
Ms Brown said there were several other grants and measures, which could help first homebuyers get their foot on the property ladder.
'If you buy or build a new home, you may be eligible for the $10,000 First Home Owner Grant,' she said.
'First homebuyers may also qualify for a $2000 grant from the Home Buyer Assistance Account to help with the incidental costs of buying a home such as settlement fees.
'Stamp duty is another major challenge facing homebuyers, as it is an additional cost on top of saving for a deposit.'
According to Ms Brown, earlier this year, 63 per cent of 15,000 respondents to a Housing Issues Survey on reiwa.com agreed stamp duty was a significant barrier to homeownership in WA.
'There are stamp duty concessions to help address this,' she said.
'If first homebuyers buy a home valued at $500,000 or less, they will pay no stamp duty, saving up to $18,000.
'They will pay a concessional rate on purchases valued up to $700,000 in the Perth metropolitan area and Peel region or up to $750,000 outside of these areas.
'REIWA has been advocating for these thresholds to be lifted for some time, and we were pleased when the State Government announced an increase in March.
'However, rising prices mean these changes could quickly become redundant.
'We would like the State Government to go a step further and link the thresholds to REIWA's median sale prices – as Keystart has done for its products – so they can move with the market and remain accessible to as many first homebuyers as possible.'
Ms Brown offered some additional tips for first homebuyers.
'Visit a mortgage broker to get an accurate idea of how much you can borrow,' she said.
'Get your finance pre-approved and speak to the selling agent about what you can do to strengthen your offer.
'Consider using a buyer's agent and, lastly, leave plenty of time for settlement.'
reiwa.com
is the home of Western Australian real estate, representing more than 1350 member agencies or 90 per cent of the sector. With more than 100 years of industry leadership and local knowledge, it is uniquely placed to provide in-depth market intelligence free of charge.