Rising prices forcing buyers to cast their net wider

Property interest remains high despite housing affordability being an increasing concern for first home buyers.

The annual QBE Barometer report showed that low interest rates are continuing to support Australians’ appetite for property, with a greater number of buyers expanding their options when purchasing their first home.

“In June 2014, first home buyers were each open to an average of 1.8 different types of property, while at February 2015 it had increased significantly to 2.4, with the trend most noticeable for houses and townhouses,” the report said.

While first home buyer appetite remains high, housing affordability continues to be a concern due to rising prices.

According to the report, 47 per cent of those who hold a mortgage or plan to get one believe property will become increasingly unaffordable, while 82 per cent said future generations will find it difficult to purchase their first home.

The report also found that 53 per cent think it’s more important to get into the market now than to wait and save a bigger deposit, while 29 per cent said prices are so high they cannot afford what they want.

Affordability appears to be particularly concerning for first home buyers, with over half stating that property is substantially over-valued, while 58 per cent fear they will never be able to afford their own home.

“Recent changes to first home buyers grants have restricted their applicability to new dwellings in most states and this, as well as high prices, may have impacted first home buyers’ ability to enter the property market,” the report said.

[LinkedIn: What can be done to help first home buyers?]

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