Price falls see 23 new city suburbs qualify for the First Home Loan Deposit Scheme

author-avatar By on February 04, 2021
Price falls see 23 new city suburbs qualify for the First Home Loan Deposit Scheme

CoreLogic has identified 23 new city suburbs that now qualify for the government's First Home Loan Deposit Scheme.

Recent price falls in Sydney, Melbourne, Brisbane, and Perth now mean some new city suburbs qualify for the First Home Loan Deposit Scheme (FHLDS), previously beyond the price caps.


Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner occupiers.

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. If products listed have an LVR <80%, they will be clearly identified in the product name along with the specific LVR. The product and rate must be clearly published on the Product Provider’s web site. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term.


The FHLDS allows first home buyers to get into the property market with a 5% deposit without having to pay lenders mortgage insurance (LMI).

One of the criteria for the scheme is for the property in question to be below state-specific price caps. 

Following price decreases since from March 2020 to January 2021, new suburbs have become eligible. 

However, all newly-eligible suburbs are for units, instead of houses (list below), with many in Melbourne's inner-ring including Docklands, Brunswick, St Kilda, South Melbourne, and more.

New eligible suburbs for the FHLDS

The 23 new suburbs eligible for the Scheme include 11 in Sydney, 10 in Melbourne, one in Brisbane, and one in Perth.

Suburb Median Unit Price January 2021 FHLDS Price Cap (Established) Price Drop from March 2020
Kellyville, NSW $675,780 $700,000 $71,882
Rouse Hill, NSW $638,755 $700,000 $88,146
Arncliffe, NSW $690,441 $700,000 $31,185
Hurstville, NSW $651,924 $700,000 $65,019
Ashfield, NSW $689,884 $700,000 $28,065
Strathfield, NSW $688,341 $700,000 $57,899
Wentworth Point, NSW $686,114 $700,000 $28,905
Gladesville, NSW $698,114 $700,000 $53,524
Ryde, NSW $678,719 $700,000 $36,181
Caringbah, NSW $679,373 $700,000 $38,053
Kirrawee, NSW $671,313 $700,000 $36,015
Balaclava, Vic $598,436 $600,000 $19,856
Brunswick, Vic $579,828 $600,000 $28,319
Docklands, Vic $575,517 $600,000 $40,679
South Melbourne, Vic $596,486 $600,000 $49,438
St Kilda East, Vic $579,514 $600,000 $34,169
Thornbury, Vic $584,288 $600,000 $27,416
Ferntree Gully, Vic $576,067 $600,000 $24,372
Beaconsfield Upper, Vic $573,562 $600,000 $28,142
Clayton, Vic $570,988 $600,000 $65,579
Oakleigh, Vic $575,210 $600,000 $53,324
South Brisbane, Qld $468,672 $475,000 $14,605
Munster, WA $397,318 $400,000 $49,036

Sources: CoreLogic, National Housing & Finance Investment Corporation, (only includes suburbs with 50< transactions in past 12 months)

CoreLogic's head of research Eliza Owen said these suburbs have been hit harder by international border closures and lack of international migration.

"The housing market has shown a robust performance, despite the shock of COVID-19 in 2020. But the pandemic has impacted pockets of the housing market, creating opportunities for buyers," she said.

"Recent housing value declines are particularly prominent in major cities like Sydney and Melbourne. These cities accounted for around 75% of international migration across the capital cities in 2018-19, meaning international border closures have created a particular demand shock.

"Unsurprisingly, six of these include unit values in the Melbourne inner region, where median values have declined an average [of] $33,313 between the onset of the pandemic and January."

Currently, the price caps are higher for newly-constructed homes, but Ms Owen says first home buyers prefer established properties, which feature lower price caps on the FHLDS.

"Established property has historically been favoured by first home buyers where benefits for both new and established property have been available. That was further demonstrated in the slower utilisation of the FHLDS when it was made available for only new property," she said.


Photo by Arun Clarke on Unsplash

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

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author-avatar
Harrison joined Savings in 2020. He is an experienced journalist, with previous stints at News Corp and financial comparison site Canstar. With a keen interest in personal finance, Harrison is passionate about helping consumers make more informed financial decisions.

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