Sentiment among first-home buyers and investors still falls far short of last year’s levels, REIA says
Recent data from the Australian Bureau of Statistics shows a slight improvement in property market confidence, but consumer sentiment still falls short of recent highs, according to the Real Estate Institute of Australia.
REIA president Hayden Groves said that despite a monthly rise in owner-occupier first-home buyer lending in March, the number of those commitments was still 22% lower than it was at the same time a year ago.
“The value of total new owner-occupier loan commitments rose 5.5% to $16 billion, while new investor loan commitments rose 3.7% to $8.0 billion,” Groves said. “However, the value of new owner-occupier loan commitments in March remained 25% lower compared to the same time last year, while new investor loan commitments were 29% lower, showing we are a long way from where buyers were last year.”
Groves said the RBA’s latest rate hike could put more strain on housing supply and the economy as a whole. After a pause in April, the central bank last week hiked rates for the 11th time in the past year, bringing the official cash rate to 3.85%.
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“Monetary and fiscal decision-makers should be doing everything they can to reassure Australians and alleviate the pressures many in the economy are experiencing,” Groves said. “This month shows a small sign of hope of confidence returning to the market, particularly for first-home buyers, but whether this trend continues remains to be seen.”
Last week, REIA warned that the latest rate hike would put “unnecessary strain on an already stressed market.”
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