Low activity of FHB buyers will affect the value of properties

Real estate values ​​could fall if first-time buyer activity declines as investor lending deteriorates and homeowners' demand drops dramatically, according to CoreLogic's recent Property Pulse.

First-time homebuyers became more active in the housing market than the previous year due to declining housing values, which helped to improve the housing market. affordability and make filing easier than in the past. Since other market segments had doubts about their market penetration, there was also less competition.

However, the latest data on housing finance provided by the Australian Bureau of Statistics revealed that the trend was slowly fading. Although the weakness is only apparent for a few months, it will be essential to monitor the situation, CoreLogic said.

Markets that include the country's largest cities have seen a drastic decline in first-time home purchase commitments.

In December, New South Wales registered 2,232 first-time homeowner purchase commitments, making it the lowest figure since July 2017. The number of new homeowners in New South commitments decreased by 5.2% over the whole month and by 3% year-on-year. -year. In terms of the share of total homeowner financing commitments, new home buyers accounted for 24% of the NSW market (excluding refinancing), up from 23.6% in the previous month.

However, the overall demand for homeowner mortgages (excluding refinancing) declined 6.1% over the month, a larger drop than the 5.2% decline in the homebuyer segment. a first home.

By December, Victoria had contracted 2,604 financing commitments related to the purchase of first-time housing, the lowest number since June 2017. First purchase purchase commitments were decreased by 7.7% over the month and by 14.8% year-on-year.

Overall homeowner commitments, excluding refinancing, show a larger monthly decline (-10.4%). Homeowner commitments, however, increased relative to total commitments. The 29% increase in homeownership financing commitments was the highest since July 2013. As a result, this share is increasing, but is up from declining volumes as a result. for new home buyers than for all homeowners.

"Potential buyers of new, more pragmatic homes are likely to see their values ​​drop and despite the incentives, they realize that if they stay on the sidelines, the properties they target could be even more accessible in the next few years. months, "said CoreLogic.

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