First-time home loans customers 'may find difficulty in market'

Tuesday 15 September 2009

Article by Mozo

First-time buyers, including those requiring low interest home loans, may find it increasingly difficult to get onto the property ladder, according to a new report.

News.com.au has outlined some of the factors that may make purchasing a new property difficult, including the removal of government first home grants at the end of the year.

Furthermore, home loans interest rates are expected to rise, while banks are seeking to tighten their lending criteria.

Also, houses in Australia are some of the priciest in the world, the news provider posited.

Commenting on the potential predicament for first-time buyers, Bernie Lewis home loans executive chairman Mark Lewis said there could be a vacuum in affordability for South Australians.

He said: "Currently, close to 30 per cent of all lending for property purchases is going to first-home buyers.

"But I expect this to fall quite significantly in the coming months."

This comes as Steven Keen, professor of economics at the University of New South Wales predicted investors may come to the fore of the buyer’s market and boost prices further.

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