A new survey shows that while most Aussies don't think now is the time to buy a home, many are still scrambling to enter the market before they're priced out
Many Aussies believe that now is not the right time to buy property – but they plan to anyway, according to new data from National Australia Bank.
Results of a NAB survey showed that only 40% of respondents believed that now is the time to purchase real estate – but 15% still intend to buy a home in the next 12 months.
Andy Kerr, homeownership executive for NAB, said that the appetite among those looking to buy a home was at an all-time high, with young people the most eager to buy. While 18% of survey respondents overall were saving to buy a home, that figure was nearly 40% in the 18-29 age group, according to The Australian.
“Despite the property price increases, first-home buyers are going gangbusters,” Kerr told NCA NewsWire. “April was our strongest month on record [for mortgages] and we were up 87% for the first four months of the year [compared to the same period last year]. That was up nearly 10% on the last four months of 2020.”
Regional markets saw skyrocketing activity last year as buyers fled cities seeking more land, causing prices in those areas to spike, The Australian reported.
So far in 2021, buyers have been seeking value, aided by increased flexibility in where they could work, Kerr said. First-home buyers were increasingly getting mortgages for inner-city apartments as they returned to the CBD for work at least a few days a week.
With a housing inventory shortage set to continue for some time, Kerr said there was a fear of missing out, with prospective homebuyers worried about being priced out of the market.
And with interest rates still at record lows and government incentives getting “great airplay,” Kerr said the First Home Loan Deposit Scheme – with its next intake round beginning – is the nudge prospective property buyers need to dive into the market, according to The Australian.
“People are realising it’s only marginally higher to buy a home than rent,” Kerr said.
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However, most first-home buyers will have a hard time finding affordable properties; the national mean price of residential dwellings is $779,000, according to Australian Bureau of Statistics data.
The First Home Loan Deposit Scheme is raising property price caps effective today – something Kerr said was the right move.
“We’re seeing record growth in first-home buyers, so I think they’ve got it right,” he said. “First-home buyers always tend to buy smaller places in potentially up-and-coming suburbs.”
Prospective homebuyers might be wise to jump into the market despite skyrocketing prices; the current historically low mortgage rates may soon be a thing of the past.
NAB announced Wednesday that it was hiking its two-, three-, and four-year fixed rates for owner-occupier loans by up to 0.1%, The Australian reported. While all four major banks still offer sub-2% two-year fixed rates, Westpac is the only major still offering one- and three-year fixed rates below 2%.