First home buyers most attracted to jobs rather than affordability

The housing finance data released by the Australian Bureau of Statistics on Oct 11 shows that first home buyer demand has remained weak.  During August the number of home loans taken by first time buyers was just 7,460.  Volumes hadn’t been that low since Feb 2005.  As a proportion of the overall owner occupier market, first time buyers equate to just 15.5% of the market.

volume
Across the individual States and Territories the first time buyer markets have all shown the same trend – a very large drop in activity.  However the fall away has been more extreme in some regions than others.

Percentage by state

Victoria and Western Australia are the most active first time buyer markets in the country.  17.3% and 16.8% of owner occupier buyers respectively secured housing finance for their first home in August.  At the other end of spectrum are South Australia (13.4%) and Tasmania (13.7%) where the first time buyer markets are the weakest.

Probably not so coincidentally is the fact that the two most affordable capital city markets in Australia also have the lowest level of first time buyer activity.  The findings highlight that housing affordability is not the strongest driver for first home buyers – more important are the employment opportunities that exist in the region.

About Tim Lawless

Tim heads up the RP Data research and analytics team, analysing real estate markets, demographics and economic trends across Australia

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