Aussies 'increasingly confident about property sector'

Aussies are far more optimistic that the nation's property market has bottomed out and an upturn in fortunes is on the horizon.

Like many other parts of the world, Australia's housing sector has been blighted by the global economic downturn, but it seems that things are finally starting to improve again.

According to the Commonwealth Bank/Mortgage & Finance Association of Australia Home Finance Index, 63 per cent of first-time buyers feel that now is the perfect time for people to get a foot on to the property ladder.

This is because prices are still relatively low and interest rates have fallen in recent months.

Rents have been rising sharply across the country and many people feel that it is far more cost-effective to take out a mortgage before buying a house outright.

Indeed, as many as 71 per cent of the survey respondents stated renting was too expensive and 50 per cent said they were caught in a "rental trap".

"Many first home buyers now realise that it is cheaper to buy than rent a property in some suburbs and this augurs well for growth in the bottom end of the market," commented Commonwealth Bank's executive general manager of third party and mobile banking Kathy Cummings.

Aussies under the age of 29 are most confident that house prices will rise in the future, with 45.9 per cent expecting an upturn, compared with just 26 per cent of people aged between 60 and 69.

As always, property buying activity will be higher in certain parts of the country than others.

The study also indicated that many people who are planning to buy a house or apartment in the next 12 months in Victoria want to move as close to the centre of Melbourne as possible.

Nearly one in four of the survey respondents said they would be looking at properties in suburbs such as Port Melbourne, Parkville, Jolimont, Kensington, Carlton, Carlton North and South Wharf.

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