00:00One of the things that they're looking to help first home buyers with is how much access
00:07to finance they can get.
00:09Currently, first home buyers can't borrow as much money because of what's known as a
00:14serviceability buffer.
00:16So it's there to restrict people getting into too much debt.
00:19So if you went to the bank today, for example, and you said, give me a variable rate and
00:23they said, okay, I'm offering you a 6% variable rate, the banks don't actually assess you
00:29at 6%.
00:30They assess you at 3% above 6%, so at 9%.
00:35So what they're saying is that 3% buffer, they should drop that a bit lower.
00:39And that would basically make it easier for first home buyers to get the finance they
00:43need to break into the property market.
00:46Well, the Australian dream is falling out of reach for millennials and for Gen Zs.
00:52One of the reasons is that the lending laws are very rigid and blunt.
00:58And they give no quarter to first home buyers or prospective first home buyers.
01:04And so there are a range of things that we are looking at through the Senate inquiry.
01:09So a lot of the people that are presenting this to this federal inquiry have over the
01:13past few weeks talked about the risks, being that it does allow people to take on more
01:19debt that they could eventually handle.
01:21And the issue is, you know, if interest rates were suddenly to rise, or a number of people
01:26lost their jobs, is then their ability to repay that debt becomes far harder.
01:31I spoke to a number of consumer groups who've all been talking about mortgage stress being
01:36a real issue right now in current circumstances, where the economy is still relatively strong
01:42while there is a cost of living crisis.
01:44We haven't seen mass numbers of unemployment.
01:48The unemployment rate is still holding steady.
01:50So the issue they're concerned about is if economic circumstances do change, and you
01:56do drop the buffer, that's allowed a lot of people to take on too much debt.
02:01So the inquiry has held a number of hearings over the past couple of weeks.
02:05And it could be in the coming weeks that it hands down its final recommendations.
02:10We heard earlier from Liberal Senator Andrew Bragg, the Liberal Party is really considering
02:16this as serious policy to take to the next election.
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