A “disconcerting” proportion of Australian first home buyers are worried they may not be able to meet their mortgage commitments.
According to the latest edition of Mortgage Choice’s annual First Home Buyer Survery, 29.2% of first home buyers said their biggest concern about home ownership was not being able to afford their mortgage repayments.
Mortgage Choice chief executive officer John Flavell
said in the result is surprising given the current state of interest rates.
“It is quite disconcerting to hear so many first home buyers worry about how they will manage their debt,” Flavell said.
“The reality is, interest rates have never been lower, meaning it should be easier than ever for borrowers to manage their debt,” he said.
Flavell said the interest rates currently available make now a prime time for first home buyers to be getting ahead on their mortgages and he hold concerns about their ability to meet repayments if interests in crease. Flavell said rate rises are likely to occur within the next few years.
“Most first home buyers would have an incredibly competitive rate – a rate they are unlikely to retain for the duration of their loan. If first home buyers are worried about meeting and managing their mortgage repayments now, how are they going to feel when interest rates start to rise?
“First home buyers should actually use the current low interest rate environment as an opportunity to pre-pay their home loan and ultimately drive their debt down as quickly as possible.”
For those first home buyers worried about their mortgage repayments, Flavell said now is the ideal time for them to be taking steps such as reviewing their mortgage or building a budget to reduce their financial stress.