Struggling first homebuyers may find it even harder to break into the property market next year as more investors plan to put their money back in the sector, a new study has found.
Mortgage Choice revealed that almost half (44%) of respondents across the country intend to invest in property in the next 12 months, buoyed by rising property prices and improving yields.
Investors' sentiment in NSW rose sharply, with 45% planning to invest - a significant increase from last year's 32%. Victorians were the most bullish, boosted by the red-hot Melbourne market. About 47% of the respondents said they are likely to invest, while Tasmanians were the least likely at 36%.
While the desire to invest in property is strong amongst property buyers in NSW, about 90% admitted to making sacrifices in order to do so. This includes buying less expensive property than desired (10%), purchasing in a non-ideal location (7%) and spending less (29%).
The report also found that a large number of Australians (45%) are choosing to renovate an existing property as an alternative to purchasing a new one; though this means that 55% of those who already own a property are planning to purchase again in 2008.