First-time buyer numbers rise sharply

Posted on 20/01/2012  

A major increase in the number of first-home buyers has added to other evidence of improving prospects for property markets around Australia.

The number of first-home buyers increased 18% in November compared to October – adding $2.86 billion in mortgage activity, the largest volume since December 2009.

Other evidence of an improving market includes eight consecutive months with rising levels of home loans (Australian Bureau of Statistics data), increasing residential land sales (from RP Data), rising rents (Australian Property Monitors) and increasing optimism by property consumers (Westpac index).

Damian Smith, CEO of financial comparison website RateCity, says there is cause for optimism about the housing market in 2012.

"November delivered the largest number of borrowers entering the property market in almost two years,” he says. “It was the fourth consecutive month with rising numbers of dwellings financed by first home buyers. It's significant because it pre-dates the second interest rate cut in December."

However, Smith cautions against reading too much into the first-home-buyer data, as the national figures were bolstered by the number of buyers entering the property market in New South Wales.

"In NSW alone, close to 4,000 first-home buyers financed properties in November – a 34% rise from the previous month. By comparison, the number of firs- home buyers in Victoria and Queensland rose 5% and 8% respectively, in the same period.

"Many home purchases in NSW were effectively 'brought forward' to meet the stamp duty concession deadline before rulings changed on 1 January 1.”

ENDS

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