Exclusive: First home buyer picks from the experts

Housing affordability for first home buyers is a perpetually hot topic. Is there a problem with housing supply, or home buyer expectations? Has investor activity ruined the game for young buyers, or does Gen Y just need to learn how to save? 

While a lot of property commentators have something to say about the first home buyers issue, most bought their first home years ago. So Property Observer took the question to the experts: What would you purchase on a first home buyer’s budget?

To get an idea of what a typical first home buyer would have to work with, we took the Australian Bureau of Statistics’ average first home buyer loan size for March and added a 10% deposit. We arrived at the following budgets for our observers:

New South Wales: $352,880

Victoria: $325,710

Queensland: $317,680

South Australia: $275,440

Western Australia: $364,980

Tasmania: $233,420

Northern Territory: $377,200

Australian Capital Territory: $329,560 

Using the above price guides, four of our Observers have suggested properties on the market that they would purchase if they were first home buyers.

Read on to see what Hotspotting.com.au’s Terry Ryder, the Real Estate Institute of Western Australia’s David Airey, Allen Wargent’s Pete Wargent and iProperty Plan’s Mark Armstrong picked.

TERRY RYDER, FOUNDER OF HOTSPOTTING.COM.AU

Terry Ryder says he would go for this three bedroom home (pictured below) at 16 Sandra-Ann Drive in Edens Landing, Queensland.

Listed at $329,000, it’s priced just a touch over our estimated average spend for a first home in Queensland of $317,000.

Ryder provided the following reasons for his pick:

• Location in growth corridor between Brisbane and the Gold Coast.
• Walk to train station, with links to Brisbane CBD and to the Gold Coast.
• Easy access to Pacific Motorway and Logan Motorway.
• Quiet, private residential area with solid standard of brick-and-tile housing.
• Lots of choices of schools in the area.
• Close to Beenleigh town centre.
• Close to retail, including a new Bunnings and a new Woolworths.
• Plenty of parkland and recreational choices in the area.
• Area has a solid capital growth record, with strong rents and low vacancies.
• House itself is low-maintenance with an entertainment area at the back (assuming we can trust the agents' blurb).

MARK ARMSTRONG, DIRECTOR OF iPROPERTY PLAN

For a Victorian property, iProperty Plan director Mark Armstrong picked a top floor apartment in Melbourne’s Thornbury, pictured below.

The one bedroom, one bathroom apartment tucked away from Kemp Street has a private balcony and a secure parking.

Armstrong says that the picked the property “because first home buyers need to think like first home investors and look for property that will have strong capital growth potential."

“This property is within 10 kilometres of Melbourne and is walking distance to shops, transport, bars/cafes and parkland. The property is elevated and has plenty of natural light and privacy and would provide comfortable accommodation.”

Another one bedroom, one bathroom apartment in Thornbury sold last month for $310,000 (pictured below). 

Read on for more first home buyer picks from our Observers on the next page.

 DAVID AIREY, PRESIDENT OF THE REAL ESTATE INSTITUTE OF WESTERN AUSTRALIA

Working with a budget of $364,980, Airey chose a three bedroom, one bathroom home in Perth’s Mandurah, pictured below.

“This property offers excellent value and lifestyle for a first time buyer,” says Airey.

“Although Mandurah is 80 kilometres from the Perth CBD, it has good freeway access and a fast commutable train service. Situated right in the heart of this seaside village, this property is just a short walk to the marina, shops, pubs, restaurant and cafe strip.

“At more than 800square metres, the block is perfect for raising a young family, growing some veggies or having a dog. It also offers good long-term capital growth. Although zoned as R20, there is plenty of space to add extra rooms in future or create an alfresco area out the back for entertaining.

“Mandurah is a city of 77,000 people and serviced with good schools, recreation and medical facilities. And all of this comes with a country lifestyle, a huge estuary for fishing and crabbing and cool ocean breezes in summer. A similar property on Perth’s northern beaches would be twice the price.

“The average annual growth rate in Mandurah over the last five years has been 0.0 per cent, as it struggled to recover from the market slump and GFC in 2008. However, REIWA data show that it achieved 3.4% growth in the year to December 2013, while more recent REIWA data indicates 7% growth for the March quarter this year. With recovery on the way, it’s a good time buy.”

PETE WARGENT, DIRECTOR OF ALLENWARGENT

Pete Wargent recommended two Blacktown properties, to first home buyers, noting that the average first timer budget in Sydney is a little higher than the New South Wales average of $352,880.

This two bedroom single level villa, pictured below, is priced from $350,000.

Blacktown is located 36 minutes by train from the city. “If the budget is tight,” says Wargent, “drop down a notch.” He suggests this single storey home at 43A/177A Reservoir Road as a cheaper alternative (pictured below).

“For $300,000 or under, look for a modern two bedroom unit,” he says. For those who are after something within 20 minutes of the CBD, Wargent would pick a property close to Campsie train station, “with low strata fees on a quiet, pleasant, leafy street.”

“Entry prices in Campsie range from $230,000 for a quality studio apartment up to $380,000 plus for a two-bedder,” says Wargent.

“A short train ride to the city, Campsie has a buzzing central strip, is gentrifying apace and within a few years will be the new Marrickville.

“People scoff when you make such assertions but that’s a recurring theme in real estate. They said that the suburbs in London’s east end would never gentrify.

“Even half a decade ago people told me when I’d bought in in the inner west in Erskineville - three kilometres from Sydney CBD - the suburb would be a “ghetto”, and years before that when I bought in Pyrmont, which is adjacent to the city, that suburb would be a “future slum”.

"Wrong, and I believe they’ll be wrong again about Campsie.”

Our Observers came up with stand alone houses, apartments, and semi-detached homes as close as seven kilometres and up to 72 kilometres away from the capital city centres for their first home buyer picks. What would you buy on a first home buyer's budget?