JobTrainer, coming hot on the heels of JobKeeper, JobSeeker and HomeBuilder, is a government program intended to help new school leavers and those out of work to get the training and qualifications needed to find gainful employment. But could this scheme help you to get the skills needed to boost your income and finally achieve the great Australian dream?
The JobTrainer package is set to subsidise wages for apprentices and provide up to an additional 340,700 training places for selected vocational education training (VET) courses, including short courses and full qualifications. Courses will be free or low cost in areas of identified need, with the federal government providing $500 million with matched contributions from state and territory governments.
The announcement of the package came at the same time as the Australian Bureau of Statistics (ABS) released new employment figures, showing that Australia’s’ unemployment rate rose to 7.4 per cent between May and June 2020.
How could retraining help you buy a home?
Getting the right training and qualifications can make a big difference to your future employment, and with it your future income. For example, according to a report from the National Centre for Vocational Education Research (NCVER), the median annual income of graduates employed full-time after vocational education and training was $59,100 (or $46,900 for graduates employed in their first full-time job after training.
The higher your income after training, the more of your household budget you may be able to put towards loan repayments without as much risk of ending up in mortgage stress, and the more a bank may be willing to lend you to buy a home.
For example, according to RateCity’s Borrowing Power calculator, a couple with no kids and average household expenses, each working full time and earning $59,100 after upskilling through a VET course, could potentially apply for a home loan of around $796,400.
What’s the catch?
It’s important to remember that banks and mortgage lenders will look at much more than just your income when you apply for a home loan. Most mortgage lenders will want to see that you’ve been in your job for 6 to 12 months or longer, so they can be confident that your income will be consistent.
Also, saving a deposit can also be a real challenge, especially for first home buyers. It may be worth looking at whether you’ll be eligible for First Home Owner Grants (FHOGs) or similar support from your state government, or if you can apply for the federal government’s First Home Loan Deposit Scheme.
You can also look at low-deposit mortgages, and explore the option to apply with the help of a guarantor. A mortgage broker may be able to help you work out which options may best suit your circumstances.