Why People Aren't Buying Houses (Apart From The Money Thing)
It's no secret why Australians are struggling to buy a home: house prices have skyrocketed and wages have stagnated.
It's not rocket science, and for many, 'the great Australian dream' of owning a property is feeling likely that it'll stay exactly that: a dream.
But even those who are financially fortunate enough to get on the property ladder, the confusion of home loans is a significant barrier to making that first step.
For Georgina Gravanis, a public relations executive, and her husband Josh Smith, a general manager, there was a complicated, two-year, back-and-forth process when they were buying their southern Sydney beach-side apartment.
"Our apprehensions were largely around whether we were going to get approved, as the home we purchased was much more than we had initially set as a price guide," she told ten daily.
"The process was complicated, with a lot of back and forth and ensuring we were staying on top of the requested documents all the time."
To make matters worse, the apartment they'd bought off the plan had a delay in completion, and it was two repetitive years of having to reapply for conditional approvals before they were able to move into the dream home.
The couple met with a number of banks and mortgage brokers during that time, finding it difficult to get a true valuation from the 'overly cautious' banks.
"The frustration was in waiting and redoing the process and having the change lenders in the final moments during the critical time of settlement," said Georgia.
The truth is, there's a lot most of us would rather do than navigate a home loan. New research from St George bank found that people will do almost anything to avoid it, including doing household chores (32 percent), sitting thought a 14-hour flight without entertainment (16 percent) or even doing their tax returns (23 percent).
An estimated 2.2 million Australians are planning to buy their first home in the next five years, yet according to St George, nearly half (48 percent) admit they've put off buying a home because the application is too daunting.
The main issues? Paperwork, red tape, total confusion about the process, according to 20 percent of respondents.
Other main issues included a lack of transparent pricing (15 percent), being unsure of what home loans were suitable (15 percent), and simply being unsure of where they stood financially (16 percent).
Interestingly, seven percent of respondents said they were unable to make that first step, because their local bank or financial institution was closed during their free time.
"Whether you're an investor or a homeowner, the banks are scrutinising every loan application, so not everything is just being approved as it was a couple of years ago," he said.
But the long predicted downturn of the housing market means the dreams of first home buyers -- who are eligible in NSW for a First Home Owners Grant of $10,000 if the property does not exceed $600,000 -- may be closer to being realised.
"It'll actually, in the next 12 months, potentially be a platform for the first home buyers to get in," said Klaric.
"I think the opportunity presents itself for first home buyers to enter that market probably within 12 to 18 months down the track."
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Lead image: AAP