True first home buyer numbers are understated: Deloitte

The number of first home buyers in the market is understated by official statistics, according to a panel of mortgage industry representatives.

Mortgage managers from lending institutions and broker networks who participated in the panel for the Deloitte Australian Mortgage Report for 2014 said their own statistics showed that there were more first time buyers in the market than Australian Bureau of Statistics data indicated.

According to ABS figures, first home buyers make up a record-low proportion of all buyers in the market at just over 12%.

However Deloitte banking partner James Hickey, who facilitated the panel discussion for the mortgage report, said panellists argued that while there were fewer first time buyers in the market than usual, some were being omitted from official data as they did not qualify for first home owner incentives.

Those who did not qualify for the grant included first home buyers whose parents were helping with the purchase, foreign buyers who were newly migrating to Australia, and those who were buying properties valued at above the threshold for receiving assistance.

First home owner concessions available now apply only to some newly built properties worth up to $650,000. Under previous schemes, grants were available for first time buyers of new or established dwellings who bought properties worth up to $835,000 between 1 January, 2011 and the end of the scheme in October 2012, or up to $750,000 for properties that settled in 2010.

The Deloitte report found that while there had been lift in total mortgage settlements to $28 billion each month, the highest rate on record, most of the activity was due to existing owner-occupiers upgrading and investors returning to the market, rather than first home buyers entering. 

The report also revealed that more than one quarter of first home buyers were aged over 35 years, with more than 5% aged 45 and over. About half of first home buyers were aged between 25 and 34.