The first home buyer market is expected to be the most active segment over the coming months, the head of a real estate agent group said.
Speaking to Real Estate Business, Century 21 chairman Charles Tarbey said first home buyers and first time upgraders will dominate the market during the traditionally hot spring selling season.
“Most activity will be in the first home buyer and upgrader segments. People that are looking to buy property under the $800,000 mark will be very active over the coming months,” Mr Tarbey said.
“Rents are rising but property prices, in many instances, are tracking sideways, which is in turn encouraging first home buyers to get their foot on the property ladder.”
Australian Property Monitors senior economist Andrew Wilson agreed and said the extended period of rate stability was helping to push first home buyers back into the market.
“Interest rates have been stable for about nine months now and, by all accounts, they will remain stable for the foreseeable future. When interest rates are stable or falling, the property market tends to attract younger buyers,” Mr Wilson said.
But, according to Mr Wilson, it is not just interest rate stability that is encouraging young buyers to take the plunge.
“With little buyer activity and lots of properties for sale, its means there is less competition at the moment, which activates entry level buyers and first time change up buyers. In addition, incomes are rising and property prices are falling, which is helping first time buyers save their deposit quicker.”
“If you want to target a particular market, the best market to target is first home buyers because I believe they will be most active moving forward.”
Mr Wilson also said it was time for first home buyers to engage the market, as the market segment has been notoriously quiet for the past six months.
Data from the Australian Bureau of Statistics found just 7,481 home loans were approved for first home buyers in Victoria during the first four months of 2011.
This was the lowest number recorded over the same period of the year since 2004 and is 48.5 per cent less than the 14,529 first home buyer loans recorded over the first four months of 2009.