Victorian first-home buyer uptick in one week since FHOG deadline announcement

It has only been a week since the Victorian government announced a June 30 deadline on changes to the first-home owner scheme grants but agents have already noticed an uptick in interest on established homes across Victoria.

It's forecast this interest could translate closer to a "mad rush" of buying closer to the deadline.

The Barry Plant Preston office says auctions have performed better after the announcement that the grant would be removed for established homes.

Melbourne buyers agent Frank Valentic suggests the rush is set to come.

The state government last week announced it would remove the first-home owners grant of $7000 on existing homes but would increase the grant to $10,000 for new homes prompting commentators to predict an unhealthy rush to buy established homes.

There will still be a stamp duty discount for all home buyers though, increasing from 30% to 40%.

Barry Plant Preston sold 85 Albert Street (pictured below) for $391,000 – well above the pre-auction price guide of $300,000 to $330,000 on the weekend.

There were five to six bidders at the auction with agents suggesting buyers were motivated by the first-home owners grant deadline.

Barry Plant last week issued first quarter results showing sales volumes were up 13.8%.

The group says the results are even better than they look as they lost almost an entire week of sales volume due to Easter this year which would normally have put them down 20% rather up 13.8%.

"We are not back in boom-times and in fact we are still travelling below the 2010 figures, however our results are proof that if agents are prepared to work hard they can achieve great results for our clients,” says CEO Mike McCarthy.

"Across the group we have reported an increase in people attending open for inspections, bidding at auction and increased page views on our web advertising, so there are definitely more buyers out there."

Buyers agent Frank Valentic from Advantage Property Consulting says he has had more inquiries from first-home buyers since the announcement.

“We’ve noticed a pick-up in inquiry and at inspections there are more first home buyers. Its already happening. It’s just now seven weeks now,” Valentic told Property Observer.

“People are getting in before the mad rush.”

A two-bedroom unit at 4/31 Mary Street (pictured below) sold for $483,000 after being marketed at $380,000 to $420,000.

Valentic says there were five to six bidders at the auction who were mostly first-home buyers.

He warns buyers that while they might capture the $7000 grant before it ends, they shouldn’t get emotional and bid above the value of the house.

“It’s the same as what we saw in 2010 with the last deadline. My advice to first-home buyers is to do your research,” Valentic says.

And there have been big jumps in the median price of houses and units in the cheapest two precincts in Melbourne, according to Australian Property Monitors data.

The median price for units in the north precinct increased from $438,000 last week to $472,500 this week.

And the median price for houses in the west precinct increased from $557,500 last week to $587,000 this week.