Despite the positive impact of the Home Guarantee Scheme (HGS) on first home buyers, the Real Estate Institute of Australia (REIA) emphasises that the persistent issue of housing stock shortages continues to challenge the Australian housing market.

REIA President Leanne Pilkington stated that while HGS has been beneficial for first home buyers, the lack of housing stock remains Australia's key issue with REIA’s latest Housing Affordability Report showing the average loan repayment now amounts to 48.1% of the median family income, 1.3 percentage points more than last quarter.

"The HGS has helped many Australians into home ownership, but high interest rates and inflation continue to pose significant challenges," Ms Pilkington said.

“REIA's latest HAR showed the number of first home buyers increased to 30,636—an 18.6% rise from the last quarter, and 7.2% more than in the June quarter of 2023.

"First home buyers now make up 36.6% of owner-occupier dwelling commitments, a slight decrease of 0.1 percentage points over the quarter but a 0.1 percentage point increase over the year."

Ms Pilkington acknowledged, however, that "while this is good news, many Australians are still struggling."

Housing Australia’s 2023-24 Home Guarantee Scheme Trends and Insights Report found that around 1 in 3 first home buyers were supported by the scheme this financial year, with 43,800 places taken up. Regional Australians made up a significant portion, with over 18,000 participants, including 13,000 using the Regional First Home Buyer Guarantee (RFHBG).

Ms Pilkington said that despite this success, housing affordability in Australia hit its lowest point since REIA began monitoring in 1996, with the average loan repayment now accounting for 48.1% of median family income, up by 1.3 percentage points from the previous quarter.

Ms Pilkington stressed the impact of persistently high interest rates and inflation on both rent and home ownership across the country.

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