(Bloomberg) -- An Australian government program aimed at helping first-time home buyers cuts off support at a little more than half the value of an average property in Sydney where the real-estate market has been booming.
The First Home Loan Deposit Scheme will guarantee eligible buyers purchasing a property with a deposit of as little as 5%. The program's price cap for homes in Sydney is A$700,000 ($478,000), according to details announced by the Treasury on Sunday
That contrasts with a median property value of A$1.2 million for the city, where a typical house costs A$1.4 million, according to CoreLogic, a real-estate data provider. The purchase-price thresholds under the new government program for other major cities are lower than Sydney.
Australia Is Flirting With Another Debt-Fueled Property Binge
Three interest rate cuts in Australia have reduced mortgage rates to a record, sending buyers flocking back to the housing market. Property price rises are largely concentrated in Sydney and Melbourne, where home values surged 1.7% in each city last month alone.
To contact the reporter on this story: Angus Whitley in Sydney at awhitley1@bloomberg.net
To contact the editors responsible for this story: Stanley James at sjames8@bloomberg.net, Gregory Turk
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