First home buyers hit new record low: REIA

The latest Australian Bureau of Statistics data has put first home buyers at a new record low since the series began in 1991.

The Real Estate Institute of Australia (REIA) president noted that the proportion of first home buyers, as part of the overall owner-occupied housing commitments, fell to 12.2%. This compares to 13.2% in June.

“This figure for first home buyers is very concerning and Governments need to look at the issues impacting on this important group,” said Bushby.

“There is a chronic under-supply of housing and added to this many state and territories have abolished home buyer grants for established dwellings which has further undermined the confidence this group needs to enter the market.”

However, he noted that the July 2014 lending figures were, overall, indicative of a stable market. With recent unemployment figures at a 12-year high, Bushby said that the Reserve Bank of Australia should be convinced to maintain rates at their current record lows.

In trend terms, owner-occupied finance commitments were flat after consecutive increases over the last fourteen months.

If refinancing is taken out of the trend data, owner-occupier finance commitments are down 0.4%, which equates to the sixth consecutive drop this year.

“Increases were recorded in Western Australia, South Australia, New South Wales, Tasmania and Victoria. The Northern Territory had the biggest rise of 0.7%,” he said.

Queensland recorded a 0.1% drop, while the ACT was stable.

“In trend terms, the number of commitments for new dwellings purchases increasedby1.3% while construction of new dwellings decreased 3.0% and the purchase of established dwellings decreased by 0.1%.

“The value of investment housing commitments again increased by a 1.2 per cent in July, following over three years of consecutive monthly increases,” he said.

However, observer Terry Ryder warns about ensuring you question the data.