News

Rise in first time buyers

ByCathy Pieroz

“First home buyers are continuing to make a much-welcome return to the Queensland property market.

“When the First Home Owners Boost was available during late 2008 and 2009, many first home buyers opted to bring their buying decisions forward to take advantage of the additional grant monies available. At the time, interest rates were also historically low after the Reserve Bank moved to protect our economy from the fiscal uncertainty of the
GFC.

“First home buyer demand peaked in about mid-2009 when about 28 per cent of homes purchased in Queensland were bought by first-time property owners. Data from the Office of State Revenue (OSR) also shows that more than 12,000 First Home Owner Grants were paid out at the same time – the second highest since the grant was first introduced more than a decade ago.

“Fast forward nearly three years and Queensland first home buyers now represent about
20 per cent of homes financed. This is slightly above their historical average and a big improvement on their lowest historical point, which was January last year, when just 3,887 grants were paid to first home buyers.

“According to the OSR, about 5,600 grants were paid to Queensland buyers in the March
quarter this year – the highest level for two years – and roughly half of their most recent peak in activity. Interest rates are now also relatively low and they can also access stamp duty concessions of up to $15,000.
“What this means is that, while demand from first home owners is increasing, it is still a
fair way off what it was during 2009, when competition was greatest. And as anyone who understands basic economics knows, when there is more demand that generally means that prices will start to increase.
“REIQ data shows that median property prices generally across the State have started to improve this year, and we are starting to see a lift in the number of sales in the affordable
price brackets.

“Some agents are also reporting a return of multiple offers on properties, especially the affordably-priced ones, as buyers compete to secure their first, or next, home.

“Queensland’s subdued property prices are also enticing first home buyers back into the market.

“The REIQ median house price for Greater Brisbane, where Brisbane first home buyer
activity is generally the strongest, is $425,000 compared to $641,000 in Sydney and $535,000 in Melbourne.

“Our regional centres also offer plenty of affordable property with Cairns, Rockhampton, the Fraser Coast, Bundaberg and Toowoomba all having median house prices of $350,000 or less.”

Source: By REIQ chairman Pamela Bennett

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