First home buyers are spending 45% of income on mortgage
Article by Mozo
First home buyers are now putting aside an average of between 40 and 45 per cent of their income for mortgage repayments, an expert has observed.
Martin North, managing consulting director of Fujitsu Consulting, told the AAP that this contrasts dramatically with the average of between 25 and 30 per cent being spent by established owners.
Mr North argued that with interest rates and property prices continuing to rise, first home buyers are being priced out of the market. Established owners, meanwhile, have been able to invest in housing and upgrade their homes, he said.
"There’s such pent-up demand for property that, even if first home buyers are pretty much excluded from the market because they just can’t afford to get in, other sectors of the economy will continue to buy," added Mr North.
Considering the difficult lending conditions at present, first home buyers may wish to compare home loans in search of the best offers. Last week, Di Bain, a finance columnist for ABC News, suggested that there is currently a ‘paradox’ in the property market, with house auctions hitting record levels while home loan demand continues to fall.
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