Low rates unable to offset high mortgage costs
The September quarter saw the lowest number of first home buyers since the Australian Bureau of Statistics began to take records nearly three decades ago, according to the Real Estate Institute of Australia and Adelaide Bank.
Adelaide Bank general manager, Damian Percy, said that high prices meant buyers were low on the ground, while the median family income required to meet median rent repayments had decreased.
All states and territories with the exception of South Australia recorded improvements in rental affordability. "First home buyers now make up 13.2 per cent of the owner-occupier market with all states and territories recording decreases in first home buyers over the September quarter 2016, except Queensland and the Northern Territory," Percy said.
"Better news was that the proportion of median family income required to meet median rents decreased by 0.6 percentage points nationally to 24.2 per cent."
The average loan size to first home buyers had increased 1.5 per cent over the September quarter, while the total number of loans decreased by 6.3 per cent. The median house price had increased in Sydney in Melbourne, while prices in Perth, Brisbane, Canberra, Hobart, Darwin, and Adelaide decreased.
The Australian Capital Territory remained the most affordable state or territory for both buying and renting, and saw an 11.3 per cent decrease in home loans to first home buyers during the last quarter.
First home buyers were most likely to purchase a property in Victoria, and attracted 30.3 per cent of first buyers country-wide in the September quarter. Only 18.2 per cent of first home owners purchased properties in Australia's most unaffordable state, New South Wales, where first home buyers made up just 7.9 per cent of the market. Real Estate Institute of Australia president, Neville Sanders, said: "Unfortunately, historically low interest rates were unable to offset the increasing size of mortgages". "It is extremely disappointing that the revised figures show fewer first home buyers since 2012. "This is the lowest figure since the ABS series was commenced in June 1991 and compares to an average of 18.5 per cent over the period."
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