Record rise in first-time buyer home loans recorded

Thursday 14 May 2009

Article by Mozo

First-time home buyers are increasingly taking out home loans, new figures show.

Research carried out by the Australian Bureau of Statistics reveals that such consumers accounted for a record 27.3 per cent of home loans issues over the course of March.

Such a figure represents an increase from the 26.5 per cent peak seen earlier this year and is significantly above the 18 per cent average market share first-time buyers have accounted for since 1991.

This rise, chief economist of the Housing Industry Association Harley Dale suggests, has been partially driven by moves to increase first-home grants as a part of the government’s stimulus package, with around 40,00 people taking advantage of such funding.

He states: "The consequences of this policy have been more construction activity, jobs and demand in the manufacturing and retail sectors in the first half of 2009 than would otherwise have been the case."

Overall, the number of first-home buyer loans, which could include low interest home loans, taken out over the first three months of 2009 was some 47 per cent above the same period last year.

Speaking earlier this month, Mike Smith, chief of ANZ Bank, claimed that although the cost of borrowing is at its lowest for nearly half a century there is no need for consumers to rush in taking out a fixed-rate home loan.

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