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Minister tells first home buyers to snap up property before the government’s loan deposit scheme kicks in

Assistant Treasurer and Housing Minister Michael Sukkar has urged first home buyers to purchase property now, before the government’s loan deposit scheme kicks off.

“If you do have an opportunity to get into the market I think you would be wise to do so,” he told 3AW’s Tom Elliott.

“I don’t think you should be waiting for the first home loan deposit scheme.”

Under the First Home Loan Deposit Scheme, which kicks in on January 1, some first home buyers will be able to purchase a house with as little as 5 per cent deposit.

The federal government will guarantee the 15 per cent difference required by banks to grant loans.

The deposit scheme will be available to 10,000 first home buyers per year.

Tom Elliott questioned whether the scheme will drive up property prices, but Mr Sukkar said he’s confident the scheme will not distort the property market.

“We think it will demonstrably impact first home buyers without distorting the market,” he said.

“The reality is there were 110,000 first home buyers last year, so this isn’t a scheme that’s going to apply to everybody.”

Mr Sukkar said the scheme will help young people who are “constantly behind the eight ball” when saving for a home.

“To save the full 20 per cent deposit is, on average in Sydney or Melbourne, taking people 9 or 10 years,” he said.

“The problem with that is … by the time you get there you need more.”

Press PLAY below for the full interview.