The first-home buyer data is backed up by recent lending stats from ME Bank, the not-for profit bank owned by industry super funds.
In July and August 2017, first-home buyers represented 24 per cent of all ME home loan applications, an increase of 17 percentage points on the same time last year.
The largest increase in first home buyer applications was in Western Australia (up 28 points to 37 per cent), Queensland (up 24 points to 33 per cent) and Victoria (up 15 points to 24 per cent).
ME’s head of home loans, Patrick Nolan, said first home buyers are clearly taking advantage of grant and stamp duty changes, and dampening demand from investors.
“Since 1 July 2017, the First Home Owner Grant and stamp duty discounts have been ramped up, providing a helping hand for eligible first home buyers,” he said.
“This means eligible first home buyers can assemble a larger deposit, reduce their loan-to-value ratio and potentially cut out mortgage insurance”.
Nolan said first-home buyers are also using innovative strategies to get a foot on the foothold in the market. ME’s research of 1,000 property owners in June 2017 found the following strategies were being used.
Review the ABS home lending data here.
Lending to investors is down…
While the number of home loan approvals rose, the value of dwelling commitments fell 0.9% to $33.03 billion in July.
“This can be attributed to the drop in the value of investment loans approved,” said John Flavell, CEO of Mortgage Choice.
In July, $12.06 billion in investment loans were approved, a 3.9 per cent decrease from the previous month.
“Unfortunately, an increase in regulatory restrictions and punitive taxes have resulted in a 3.9 per cent reduction in investor lending, which remains an aspect of the market for monitoring,” said Reardon.
“I am not surprised to see a downwards shift in investment demand. Over the past few months, we have seen a number of Australia’s lenders tweak their pricing and policy in this area. These changes have made it hard for some investors to qualify for finance,” said Flavell.
…but loans to owner-occupiers are up
The total value of owner-occupied housing loans rose 0.9 per cent to $20.96 billion in July.
“This is not surprising as the banks have recently been reducing the rates on their owner-occupied principal and interest home loan products and there are some competitive deals to be found,” said Flavell.