First homebuyer levels have improved in April 2015, as housing finance reached new highs at $32.7bn. Loan sizes also soared, a new report has revealed.
The housing finance data from the Australian Bureau Statistics (ABS) has shown that the number of homebuyer home loan commitments as a percentage of total owner occupied housing finance commitments increased to 15.2% in April 2015 from 15.1% in March 2015.
Data also stated the value of new home loans taken up for investment housing was up 2.6% in April to $13.5bn. There was also a 3.1% jump in the value for owner occupier housing loans to $19.2bn.
Moreover, the report said fixed-rate loans, as a proportion of all new home loans, were down to their lowest level (of 10.3%) in almost five years, according to Amanda Watt of new banking business act.
“Given interest rates are low and moderating house prices in some cities, paying your mortgage is now cheaper in some cases than paying rent. This will attract first home buyers back into the property market. Returns from term deposits are also very low, and this may push some younger people into property out of low-yielding cash products,” said Watt.
“In the smaller cities, price growth may ease further this year. While Sydney prices remain out of bounds for many buyers, and that’s not likely to change any time soon, the situation elsewhere is much more positive and encouraging for home buyers. House prices may even drop if interest rates were to rise in 2016.”