Ensure you never miss an issue of the
real estate business bulletin
FHBs wary of rate hikes

FHBs wary of rate hikes

by Reporter 0 comments

Staff Reporter

First home buyers are struggling to crack the property market, new research has found.

According to RateCity's inaugural First Home Buyer Report, the threat of further interest rate rises is stopping many potential home buyers from taking the plunge.

RateCity's chief executive officer Damian Smith said home buyers had already been dealt three rate hikes earlier this year, and would struggle to cope with any more upwards rate movements.

"RateCity's First Home buyer Index shows that it is 18 points tougher for first home buyers nationally in August compared to August 2009," he said.

"The number one reason is the sharp increase in interest rates. We've seen a 1.6 percentage point rise to the benchmark basic variable rate - which is the average of the major four banks including ANZ, Commonwealth Bank, National Australia Bank and Westpac - to 6.78 percent."

Mr Smith said the end of the government's First Home Owner's Boost had also negatively impacted first home buyer demand.

"There's around $50 million less per month being paid to first home buyers through the First Home Owner's Grant than there was in August 2009," Mr Smith said.

"And the number of first home buyers has significantly reduced since last year - now only around 15 percent of mortgages are going to first home buyers, versus an average of 26 percent last year," said Mr Smith.


le>.b-autolinks{text-decoration:underline}.b-autolinkshadowbox { display: inline; position: relative; cursor: pointer; color: #428bca;} .b-autolinkshadowbox:hover > span { display: block !important; } .b-autolinkshadowbox__links { white-space: nowrap; z-index: 999; display: none; left: 0; border: 1px solid #bfbfbf; border-radius: 5px; font-size: 12px; top: 12px;color: #000; padding: 10px; position: absolute; background-color: #FFF; box-shadow: 0px 0px 20px 1px #bfbfbf; } .b-autolinkshadowbox__links > a { display: block; padding: 3px 0; }
FHBs wary of rate hikes
lawyersweekly logo
promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2017

The REB Top 100 Agents ranking is the foremost ranking of agents in Australia. It has set the bar for excellence in Australian real estate. To be ranked as an REB Top 100 Agent is the standard real estate professionals strive for. See the full 2018 ranking here!

featured podcast

featured podcast
The difference between an average agent and one who dominates

McGrath Crows Nest’s Peter Chauncy is number 10 in this year’s REB Top 100 Agents ranking. Peter, however, is more likely not surprised ...

View all podcasts

Would you consider working for Purplebricks or a similar 'DIY' model?

Yes (7.2%)
No (80.9%)
Perhaps - make me an offer (12%)

Total votes: 209
The voting for this poll has ended on: July 13, 2018
Do you have an industry update?