Helping hand for home buyers
By ANDY PARKS
FIRST home buyers in Lismore may be able to get the Council to act as a guarantor for loans of up to $250,000.
It is a move that is thought to be a first for Australia, and possibly the world.
The scheme, which was reported in The Northern Star last Saturday, was approved by Lismore City Council at its meeting on Tuesday night.
It would be available to people buying in the Lismore Local Government Area (LGA) who are eligible for the First Home Buyer's Grant.
Council would act as a partner with a suitable Financial Institution, such as a bank or another mortgage lender, who would then be responsible for assessing the applicant's capacity to pay.
If the applicant met the institution's requirements at all levels but did not have the resources to provide a deposit, the institution could then make an application to the Council to act as guarantor.
Priority would be given to people who currently live and work in the Lismore LGA and people who work where there is a skills shortage.
The CEO of Northern Rivers Social Development Council Tony Davies spoke in favour of the scheme.
"This fits in to a broad range of possible solutions looking at the issue of affordable housing," he said.
"By taking this step, the Council is doing something which will have an immediate effect and provide an example to other councils."
He said Council also needed to look at the issue of affordable rental properties and to make sure applicants for the scheme were able to meet their repayments.
Cr David Tomlinson expressed his concern the scheme would actually increase house prices in the lower end of the market.
"You'll have to try it and see, this hasn't been done before," Mr Davies said.
"Though I have spoken to a Queensland developer who asked me if there was a market for houses under $200,000 in this region."
Cr Tomlinson moved an amendment requiring council to investigate other affordable housing options.
The amendment and the loan scheme were passed seven votes to five.