Home News Number of first home buyers drop to lowest level since 2004

Number of first home buyers drop to lowest level since 2004

Font size :

New housing finance data released by the Australian Bureau of Statistics show that the number of first home buyers is now at their lowest level in more than a decade, dropping from 14.4 per cent in April to only 13.9 per cent in May. Back in 2004, the proportion fell to 12.8 per cent as grants for first home buyers came to an end.

“A drop of prices of some sort is needed, but we’ll also need a reduction in expectations in terms of what first home buyers are looking for,” said Angie Zigomanis, BIS Shrapnel senior manager of residential. “At some point, they have to come back, in theory, but for now, the market is tough.”

A slowdown might also be in the cards, as evidenced by the decline in overall lending figures from 2015.

“We’re seeing a pullback in housing finance that has been going on since late last year, which is consistent with the idea that the housing market is set to cool,” said HSBC chief economist Paul Bloxham. “It’s a result of tighter prudential settings and is also a sign that the exuberance has come out of the market. There was a concern that strong activity from investors was overheating the market.”

For Bloxham, a return of first home buyers in the market is imminent, perhaps due to a pullback in apartment prices and significant apartment supply. The same view is shared by Domain Group chief economist Andrew Wilson, citing the surge of loans approved over May to investors.

“Investors are re-entering the market,” he said. “The catalyst was lower interest rates and the prospect of a change to negative gearing, but they have been itching to get back in any way.”

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

New social housing aims to transform Ivanhoe Estate New social housing aims to transform Ivanhoe Estate

The sprawling redevelopment aims to boost the supply of affordable housing in Sydney Read more

A new suburb will be built in west Melbourne A new suburb will be built in west Melbourne Mount Atkinson will become home to more than 22,000 people over the next 15 years ... Read more

Surging house prices threaten liveability in Melbourne Surging house prices threaten liveability in Melbourne Analysts warn the city could become just as unaffordable as Sydney, if property trends continue ... Read more

More Aussies would benefit from regional hubs linked to cities More Aussies would benefit from regional hubs linked to cities Shorter commutes could spur higher home sales in regional towns, analysts say ... Read more

More mortgage news and articles

Sponsored Links

Thursday, Aug 17, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Let us help you find the right home loan for your needs.

Tell us a bit about your circumstances:
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords