Mortgage applications drop 9% for singles

by Miklos Bolza17 Jan 2017
The number of home loan applications by single borrowers has dropped by 9% over the past two years, according to new analysis by industry super-fund owned bank ME.
Looking at customer data of 40,000 loans taken out with ME over the past two years, the bank found that only 35% of all loan applications were taken out by single home buyers.
In the same time period, the average loan size for single mortgage applications shot up by 9% to $355,000.
Looking at gender, the number of applications for single females fell by 14%. Single men were much better off with applications merely dropping by 4%.
State-by-state, singles in NSW experienced the greatest increase in average loan sizes with mortgage values rising by 16% to $422,000. This was followed by loans in Victoria which rose by 11% to $348,000 and Queensland which increased by 2% to $336,000.
“Even as part of a couple, east coast property prices are out of reach for many Australians,” said ME head of home loans, Patrick Nolan.
This was reflected by the number of loan applications by single home buyers which fell across the eastern seaboard. Application volumes by unmarried borrowers dropped by 15% in Queensland, 11% in Victoria, and 7% in NSW.
“Being single is not a reason to delay or forgo home ownership. Buying your own home is one of the smartest decisions you can make,” Nolan said.
Other strategies such as buying investment property, buying off the plan or looking beyond the ‘uber’ suburbs were key to help single home buyers enter the market, he told Australian Broker.
“Alternatively, single home loan applicants may want to consider support from family. Research by ME confirms that over the last five years 26% of first home buyers have received financial assistance from a family member. Loans or gifts were the most common form of financial assistance provided at 22% while 5% received support through a guarantor.”
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