Only one in 50 NSW borrowers are first home buyers

by Julia Corderoy04 Dec 2014
Fewer than one in 50 new borrowers in New South Wales are first home buyers, according to data from one of the largest mortgage aggregators.

The November data from AFG revealed the proportion of first home buyers in NSW fell to 1.9%, making it the lowest ever on record for the aggregator. By contrast, investor mortgages made up more than half (50.9%) of home loans in the state over November. 

First home buyers also fell to their lowest ever level in Victoria and South Australia where they comprised just 7.4% and 6.3% of new borrowers respectively. First home buying increased slightly in Queensland to 5.2% from its all-time low of 4.7% last month, and in WA rose from a low of 17.9% in October to 19.1% in November.

Mark Hewitt, General Manager of Sales and Operations at AFG said the lack of first home buyers in the market is no surprise given the lack of government incentive. 

“We’ve been highlighting the imbalance in the market since the axing of first home buyer grants in several states. Last month was the closest to zero we’ve recorded for NSW, and first home buying is well below its long term trend of around 12% - 15% everywhere except in WA.”

In WA, first home buyers receive a $10,000 state government grant if they move into a new build property, or $3,000 if they buy an established property.

However, the aggregator says the proportion of loans processed by non-major lenders for first home buyers has increased sharply from 30.9% in October to 35.7% in November.



  • by Brado 4/12/2014 9:08:30 AM

    These figures are purely based on people applying for the FHOG. I do heaps of loans for first home buyers buying established properties and therefore getting no grant. Doesn't mean they aren't buying, they just aren't buying new...

  • by Awesome - Albert 4/12/2014 9:39:15 AM

    Great point Brado..but are they buying established because they want to or because that is all they can afford? We need more help with new properties for first time buyers to help increase the supply of new properties.

  • by Tim 4/12/2014 12:04:38 PM

    Albert I recently had to drive from my home on the northern beaches of Sydney to Smithfield in the south west and was blown away by the amount of residential unit construction I saw going on along the way.
    There are plenty of properties being built and like Brado I am seeing many first home buyers either buying established units or buying for investment and thus not getting the FHOG.
    The other issue is around the attitudes towards saving a deposit. There is so much media hype around "it is too hard to save a deposit" when the truth is there are young people out there doing just that.
    Rather than push for more cash handouts I would prefer to see a push for more incentives for good saving habits. Scrapping the "First Home Saver Account" scheme was a poor decision for example.
    I was recently chatting with a 32 year old single female who had been renting for 12 years and had savings of less than $5,000. I asked her would she have missed $100 per week from her wages and she said no probably not. When I told her this would have amounted to over $60,000 she was very surprised and she acknowledged that her attitude was one of spend not save. She also said a lot of her friends have a similar attitude to her....