Lifelong renter reveals the novel way he bought his first home without help from his parents – but here’s why his property boss thinks he made a BIG mistake

A long-life renter has bought a home by dipping into his superannuation rather than asking his parents for help.

Stuart Thompson, 40, bought a two-bedroom, two-bathroom apartment in the Melbourne inner-east suburb of Hawthorn for $585,000 last year after saving for five years to build a deposit during a cost-of-living crisis.

But he managed it without the help of his parents, who live the UK.

‘It’s definitely harder, it would be nice if parents could kick in some free money,’ he told Daily Mail Australia. 

‘Mine weren’t in a position to do so and also, like obviously I don’t live in the country that my family live in, I didn’t have the option to stay at home rent free.’

That meant finding ways to get into the property market with a smaller deposit, after renting for almost two decades in Melbourne.

‘I’ve been renting here for 17 years or so – I think I must have lived in about 17 different places,’ he said.

‘It’s not always as easy as you want it to be.’ 

The English migrant also avoided paying stamp duty to the Victorian government by purchasing a property under the $600,000 threshold.

The senior property manager with Little Real Estate who earns a low, six-figure salary said Millennial first home buyers like him had a chance to get into property if they were aware of government schemes. 

‘There’s definitely hope as long as you’re able to put some money aside,’ he said. 

‘It’s easier said than done obviously with the cost of living and rents going up.

‘I don’t think I’d ever lost hope but I think going back five to 10 years ago, I would not have been in a position where I thought it was realistic.’

After getting pay rises, he accelerated his savings to borrow at the maximum capacity but with a smaller deposit.

‘I came from having not much savings at all,’ he said.

‘Once I started progressing in my career and I was earning better money, obviously it made it a lot easier.’ 

Mr Thompson made the leap to being a first-home buyer after renting and share housing in Melbourne since moving from Kent, near London, when he was in his early 20s.

‘I’ve lived in Melbourne for 18 years almost – loved it from the moment I got here, the way of life,’ he said.

‘There’s so much to do: it doesn’t matter what you’re into, there’s something for everyone.

‘I had some friends that were already in Melbourne and were saying I should come over and try it out, they’re having a really good time.

‘I just found people here are really friendly, the weather’s pretty decent especially compared to England.’ 

To finance his 11 per cent deposit, Mr Thompson voluntarily added $45,000 from his super over three years to build up his retirement wealth, and then withdrew $41,000, combining that with existing savings to get a $520,000 mortgage.

This is allowed under the government’s First Home Super Saver Scheme and workers can nominate to have extra wages put into their super.

‘Those schemes, especially the super saver one, were really valuable because I can salary sacrifice straight into the super so I don’t even see that money and I don’t get taxed on it,’ he said. 

‘So, it’s like forced savings.’ 

But Australians can’t withdrew from compulsory employer super contributions to buy their first home.

This would be unlikely to change unless the Coalition won the May 3 election with its policy of allowing up to $50,000 to be be withdrawn from super to buy a first home.

The federal government’s First Home Guarantee also enabled Mr Thompson to buy with a smaller 10 per cent deposit and avoid the usual lenders mortgage insurance.

But he has to watch his budget carefully, with mortgage repayments consuming more a third of his pay – the traditional definition of mortgage stress.

‘I’m finding now that I’m kind of living fortnight to fortnight – I have no savings,’ he said.

Things could change, however, with the futures market expecting the Reserve Bank to cut interest rates by 125 basis points by the end of 2025, taking the cash rate from 4.1 per cent to 2.85 per cent as Donald Trump’s tariffs hit the economy.

‘I’m kind of like having to really watch what I’m spending at the moment but hopefully there’s some light at the end of the tunnel when we get some rate drops in the next couple of years,’ he said.

‘I’m hoping there will be capital growth, with Melbourne apartments you’re never quite sure if it’s going to go up or not but I’m hopeful that it will.’ 

But Little Real Estate’s regional manager for Victoria, Stephen Ericksen, said buying a house in Melbourne for under $600,000 would have been better than purchasing an apartment for the same price near the city.

‘You can get a really decent, four-bedroom house for under $600,000,’ he told Daily Mail Australia.

‘When the rent is not much different to the mortgage repayments, especially if it’s a house where there’s land involved, it will get really good capital growth over that 10-year period.’ 

Mr Ericksen expected inner-city apartment values to stay the same, even after a decade, as developers built more units.

‘If it was an apartment for me, personally, I wouldn’t go there – the growth has just not been there in the Melbourne market,’ he said. 

‘More just keep going up.’

Melbourne still has affordable outer suburbs with Frankston North having a mid-point house price of $603,484 while Broadmeadows is even more affordable at $584,218. 

Melton is cheaper still at $483,648, which means a house with a backyard is cheaper than a unit near the city.

Mr Ericksen said Melbourne house prices would go up as the RBA cut rates, despite Victoria’s $975 investor land tax.

‘The really prudent buyers have already started,’ he said. 

Someone can buy a house and rent it out, and still claim it as their principal place of residence for six years to avoid having to pay capital gains tax when they sell.   

‘My advice to family and friends or anyone that I talk to is if you can buy the land, buy the house and if you can actually have some scope to do some home improvements, you can really quickly get some growth equity,’ he said.

Those wanting to live near the city are advised to rent where they want to live as they rented out a house that would go up in value.

‘You can still live where you want,’ he said.