First-home buyer activity rises in NSW and VIC

By Michael Mata | 25 Oct 2017

According to the latest data from the Australian Bureau of Statistics (ABS), financing for first-time owner occupiers has rebounded significantly this year.

In August 2017, there were 10,227 owner-occupier first-home buyer finance commitments – the most since December 2009. “In original terms, the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments rose to 17.2% in August 2017 from 16.6% in July 2017,” the ABS said.

A major driver of the increases has been the recent policy changes for first-home buyers in New South Wales and Victoria, according to CoreLogic.

Since July, first-home buyers purchasing a property valued below $600,000 in Victoria are exempt from paying stamp duty. Discounts are also available for property purchases between $600,000 and $750,000 on a sliding scale, regardless of whether they’re new or existing homes.

In NSW, stamp duty was axed for existing and new homes valued up to $650,000. Stamp duty was also discounted for homes valued up to $800,000.

As a result, between June and August, the number of owner-occupier first-home buyer housing finance commitments has increased by 59% in NSW and 34% in Victoria.

“This data highlights that stamp duty is one of the key barriers for first home buyers wanting to participate in the housing market, at least in NSW and Vic,” CoreLogic said.

In NSW, there were 2,426 first-home buyer commitments in August, the greatest monthly total since January 2012. First-home buyers accounted for 12.9% of owner-occupier commitments over the month, the highest proportion since October 2012.

In Victoria, there were 3,162 first-home buyer commitments in August, which accounted for 18.3% of all owner-occupier commitments. The commitments for August was the greatest number since December 2009, and was the highest proportion since August 2013.

The surge in first-home buyer activity has not resulted in a boost in house prices, and due to lower interest rates, many are finding it easier to pay off a mortgage than in previous years.


Related Stories:
Stamp Duty Concessions Impact Auction Markets
Housing Affordability Improves Slightly

 

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