First-home buyer representation hits five-year high in latest ABS lending data

First-home buyers have again lifted their claim on new mortgage lending in Australia, according to official data, with experts calling 2018 the year of the first-home buyer comeback.

The number of home loans written to first-home buyers, as a percentage of total owner-occupied loans, rose to 18 per cent in November 2017 from 17.6 per cent in the previous month, ABS housing finance data show.

The last time the figures were at 18 per cent or above was 2012 – although that figure was still a long way off May 2009 when first-home buyers made up 31.4 per cent of all new mortgages.

The figures also show policy measures aimed at dissuading property investors continued to bite in November, with a seasonally adjusted 1.5 per cent gain in finance to investors in the month but an 8.3 per cent fall year-on-year.

Overall housing finance commitments were up 2.1 per cent in November and average loan sizes for both owner occupiers and first-home buyers rose – $11,000 and $3000, respectively.

Chief economist at Market Economics Stephen Koukoulas said a softer national market, low interest rates and better buying conditions were coming together to help many young buyers into the market.

“Opportunities for first-home buyers are certainly improving,” he said, but warned the figures may not continue to rise, but rather track sideways from current highs.

“Once you’ve already had a decent pick-up it’s hard for it to keep growing.”

“Maybe there will be more of a consolidation of these higher levels rather than extra growth.”

Since the state governments stamp duty discounts were introduced in July 2017, the number of monthly first-home buyer approvals is now up more than 60 per cent in New South Wales, and nearly 50 per cent in Victoria, according to ANZ researchers, which other experts say shows “now is a great time for first-home buyers”.

“We’ve had over 100 per cent increase in the number of applications from first-home buyers,” ME Bank head of home loans Patrick Nolan told Domain.

“Regulatory changes and interest-only changes makes it harder for investors to afford borrowing. It’s opened up space for people to come back in and bid.”

Meanwhile the amount of time first-home buyers spend looking for a property has dropped to between 30 and 40 days from between 60 and 90 days, according to First Home Buyers Australia.