The Grattan Institute’s Brendan Coates, who authored a report recommending such a scheme earlier this year, said a federal government co-ownership program would be best-suited to older buyers who had perhaps lost their home due to a marriage breakup, and risked renting into their retirement.

For these buyers, the biggest concern is paying off a mortgage before they retire, making a shared-equity scheme – which reduces the amount they have to pay off because the Government is acting as a silent partner – quite attractive.

For younger first home buyers, whose biggest barrier is the deposit, Coates said the Home Guarantee Scheme, introduced under the Coalition but set to continue under Labor, would be more suitable.

Catherine Mapusua from lending and payments provider WLTH also said the Help to Buy scheme would be attractive for older people who might be concerned about “missing the boat” on a mortgage when they were younger.

“This would provide them with the stability of paying off an asset rather than paying rent in the rising rental climate,” Mapusua said.

She also said the Help to Buy scheme would be attractive for younger people trying to purchase their first home, because the 2 per cent deposit would be beneficial since it bypassed the need for years of saving to get into a property.

She said this might make it more attractive than the Home Guarantee Scheme, which required a 5 per cent deposit.

Full Article: Yahoo! Finance