First home buyer investors on the rise

First home buyer investors on the rise
First home buyer investors on the rise
GUEST OBSERVER

First time real estate purchasers in Australia are increasingly entering the property market as investors rather than as owner occupiers.

Data has found the number of first time buyer investors has skyrocketed over the past two years.

Since 2014 the number of first home owners who are buying through iBuyNew to invest has increased by 188 percent.

The findings by iBuyNew, which specialises in off-the-plan properties, follows a warning by outgoing Reserve Bank Governor Glenn Stevens that the entry hurdles for first home buyers “may be getting worse”.

Mr Stevens said “almost the only way” first home buyers can enter the property market in real estate hot spots such as Sydney is through parental assistance.

Despite record low interest rates, the first time buyerowner occupier sector has collapsed with many who do choose to buy property now doing so as investors.

Even though property in most cities is very affordable with interest rates set to stay at historical lows, young Australians have been put off entering the market and they prefer to rent.

The reality is that the great Australian dream of owning your own home is fading and the goal of being a home owner is diminishing.

It’s an issue for state and federal governments with the current schemes to entice first home buyers out of the rental market either out of date or ineffective. 

We have also found that stamp duty which can add many thousands of dollars to the cost of a property purchase is also a major deterrent to first home buyers.


Mark Mendel is chief executive officer of iBuyNew and can be contacted here.

 

 
Tags: 
First Home Buyers Residential Investment

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