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Just as the ABS and APRA continue their work on improving the quality of first home buyer statistics, one real estate expert says that recent data is indicating that first-timers are indeed returning to the market.
RE/MAX Australia managing director Michael Davoren said that the REIA recently reported that first home buyers are at the highest level since July 2013 and the number of first home buyer home finance commitments is the highest since December 2009.
He also said that this evidence is supported by activity in the real estate offices he’s been visiting though his network.
“We could expect first home buyers to be more active in the states where affordability is greater, choosing Adelaide and Brisbane over Melbourne and Sydney, for instance,” Mr Davoren said. “But first home buyers are not going to move into a market to buy property if they don’t see the jobs market there as being strong.”
“Housing affordability, jobs availability and transaction costs are all part of the FHB equation.”
Mr Davoren believes that first home buyers are drawn to the market through a desire for stability.
“They want the stability that comes with home ownership,” the managing director said.
“Unfortunately, our rental market is not geared for long-term occupancy, but people don’t want to move every six or 12 months when they have settled children in schools, made friends and become part of social groups.
“We recognise the impact school catchments have on the property market. They draw buyers, who want to stay put.”
He also said that stability comes from wealth generation.
“Most people want to grow their wealth, and for the average person, property is the most understandable way to do this.
“In a low interest environment [like] we currently experience, putting money in the bank isn’t going to grow your wealth — and the stock market is not for all and far too volatile for some — but most people understand the wealth in owning your own home.”
Mr Davoren said that the new stamp duty exemptions and concessions in NSW and Victoria played a role in igniting the sector.
“The FHB data the ABS released in August showed an increase in the number of entry-level buyers in NSW, which was probably the result of the stamp duty concessions introduced there.
“Is increasing government help for first home buyers the right strategy going forward? Yes, I believe so.”
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