Further enticement for home buyers.
Article by Kevin Boyle
Home builders in Australia are using discounts, gift cards and helping with home loan repayments as last ditch efforts to attract new home buyers.
Despite a 1.75 percent cut in interest rates since November 2011 that was expected to give a push to the local housing market, residential developers say they are experiencing the worst conditions in over 20 years. The poor performance of the market is pushing home builders to offer large incentives in hopes to attract potential investors and buyers. Australia's largest residential developer Stockland reportedly offering as much as $30,000 to potential customers in Queensland, Victoria and New South Wales. Devine Ltd is offering to take over up to one year of home loan repayments and Peet Ltd are offering discounts of up to $50,000 in Western Australia, Queensland and Victoria, reports Bloomberg.
The offer coincides with government handouts of up to $15,000 for lower-end new built homes in Queensland, New South Wales and Victoria. However builders are not expected to see a change in sales and profitability for some time.
"Affordability based on mortgage costs has improved, but people are worried about losing their jobs. House buyer confidence isn't there," according to Tuart Cartledge, managing director of Pheonix Portfolio's
This however translates to good news for those who are ready to set a foot in the property market. Home buyers benefitting with discounts from builders, government handouts and of course the reduced repayments on their home loans thanks to the current low in interest rates set by the Reserve Bank.
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