Investors are starting to return to the Australian property market, with new figures revealing a 2.9% increase in loans to investors during March.
Despite the rise, the ABS figures show investor participation is still well below where it needs to be to help improve the current rental crisis.
Broker Mathew Spiteri of Engaged Finance says the lack of investors means rents are continuing to rise which will make it harder for first-time buyers to save a deposit.
“It will impact people’s ability to save for a home deposit and will make it even harder for first home buyers to crack into the market and compete with more experienced buyers,” he says.
Until investor numbers return to a more normal level there will be fewer rental properties for potential tenants to choose from.
“This means an increase in competition for properties available and competition amongst renters for properties will increase further,” Spiteri says.
He says landlords are achieving record prices from prospective tenants desperate to secure a place to live.
Atlas Property Group director Lachlan Vidler says investors comprise 35.1% of mortgage demand by value, up from a recent record low of 22.9% in 2020.
There are about 2.5 million rental properties in Australia with only about 37,000 of those vacant in March.
SQM Research figures show that in December 2016 there were nearly 90,000 vacant rental properties which was the most recent peak vacancy rate period.