Housing affordability in Australia has plummeted to record low levels. According to the 2024 PropTrack Housing Affordability Report, a median household can afford to purchase only 14% of all homes sold across the country, which is the lowest share since records began.
Customer-owned banks have a long-standing commitment to financial inclusion, which is why they are dedicated to helping first home buyers purchase their first home – often using innovative ways to help Australians achieve their dreams of homeownership.
In this article, we will examine the specific approaches of three customer-owned banks and how they are empowering first home buyers.
Helping Tasmanians secure their first home
Tasmania’s only customer-owned bank, Bank of us, is the partner lender to MyHome; a Tasmanian Government initiative aimed at assisting eligible home buyers to build or purchase a home to live in.
MyHome shares the upfront costs of owning your own home, which reduces the deposit customers need as well as mortgage repayments. MyHome only requires only a 2% deposit, compared to the standard minimum deposit of 5%.
Since mid-2022, more than 1700 have achieved the dream of home ownership through this initiative.
“We were established 155 years ago to help Tasmanians realise the dream of home ownership. In all the time since, that hasn’t changed,” Bank of Us Paul Ranson said.
To find out more about the MyHome program and to see if you are eligible, visit Bank of us.
The essential workers home loan
Customer-owned Police Bank and HOPE Housing came together in 2020 with a shared vision to create a scheme to make homeownership attainable and more affordable for essential workers.
The way this shared equity scheme works is HOPE Housing co-invests in homes with eligible essential workers including police officers, teachers and nurses, with Police Bank providing the aspiring homeowner with finance for their portion of the home. The worker decides where to buy and the HOPE fund co-invests up to 50% of the purchase price. The 10-year closed fund pays distributions to investors when a property is sold, or the homeowner buys out HOPE’s share.
“Partnering with HOPE was a no-brainer for us, allowing us to help get more essential workers into their own homes. We couldn’t think of a more deserving demographic than those who serve our community,” Police Bank CEO Greg McKenna said.
There are big dreams for HOPE, with more than 3,000 essential workers on the waitlist seeking support to purchase their own home close to where they work so they can stay in the community they are dedicated to serving.
To find out more about this program and to see if you are eligible or would like to become an investor, visit Police Bank.
Financial education and support
G&C Mutual Bank recognises that buying a home is one of the most significant financial decisions you can make, which is why they focus on education, guidance and support.
The customer-owned bank provides a comprehensive and free online Guide to Buying Your First Home, which offers valuable insights to help buyers navigate the market.
G&C Mutual Bank also has a First Home Buyer Loan which was especially designed to make it easy for first home buyers to break into the property market. They also offer an Essential Worker Home Loan, specifically designed to recognise the contribution essential workers make to the community by supporting their home ownership journey.
For their support of first home buyers, G&C Mutual Bank was recognised in Canstar’s First Home Buyer Awards 2024 as the Customer Owned Bank of the Year both in NSW and VIC, and their Essential Worker Home Loan won the 2024 Finder Innovation Award for Social Impact Innovation. For more information about the guide and these products, head to G&C Mutual Bank.