Biggest share of first home buyers

by Rebecca Pike18 Jan 2019

First home buyers have claimed their biggest share of new housing loans in more than six years, according to recent figures.

The latest Australian Bureau of Statistics (ABS) Housing Finance figures show first home buyers made up 18.3% of owner-occupier loans taken out in November, an increase of 0.2% from last month. This is the highest share for first home buyers since October 2012.

Meanwhile, the value of investor commitments dropped 4.5% month-on-month and 23.4% year-on-year, in seasonally adjusted terms.

Overall, the value of home lending fell 2.5% in November, after an unexpected uptick in October. Owner-occupied housing also fell in value by 1.4%, according to the seasonally adjusted figures.

According to RateCity.com.au data shows some banks are competing fiercely for first home buyers, with offers like grants and cash back offers, to fee waivers and rebates.

Sally Tindall, research director at RateCity.com.au, said first home buyers were getting a stronger foothold in a slowing property market.

“Many first home buyers have been biding their time, squirreling away savings and waiting for the opportunity to strike,” she said.

“There’s finally space in the market for them to find their feet without having to go head-to-head with experienced investors.

“While the banks still have serviceability requirements on a tight leash, they’re welcoming first home buyers in the door, provided they’ve got a decent deposit and have a proven track record of frugal spending.”