- Australia’s booming property market might be poised for a slowdown amid increasing affordability challenges, rising borrowing costs, and a growing inventory, according to analysts.
As of the end of October, national home prices either reached or were close to record levels. Analyzing data from CBA, it is evident that mortgage repayments as a percentage of income are currently the least affordable on record in all cities except for Brisbane and Perth.
The dollar index touched a nadir at 103.37, marking its lowest point since September 1. This decline follows a nearly 2% drop last week, representing the most substantial weekly percentage decrease since mid-July.
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- First home buyers are finding new ways into the market
Government incentives and innovative mortgage solutions, as offered by lenders like NAB, are expanding the possibilities for first-time buyers to realize their homeownership aspirations.
The property market experienced a downturn last year, presenting a unique opportunity for first-time homebuyers to enter the market. Lending options that open up more pathways to homeownership, coupled with government initiatives like the First Home Guarantee, are providing crucial support.
In 2022, as home values saw a decline, rising interest rates facilitated savings for potential buyers. This led to a reduction in the time needed to accumulate a deposit for an entry-level house by approximately six months, and for an entry-level unit, it decreased by about two months compared to the previous year, according to the 2023 Domain First-Home Buyer Report.
Although home values have been on the rise in 2023, NAB Executive Broker Distribution, Adam Brown, noted that first-time homebuyers remain enthusiastic about entering the property market and are successfully navigating the associated challenges. Mortgage brokers play a pivotal role in guiding them through the complex process.
“Younger Australians, like everyone else, are grappling with increasing living costs and serviceability challenges. However, they are not allowing these challenges to deter them from achieving their homeownership dreams. They are actively exploring new avenues to make their property ownership aspirations a reality, and mortgage brokers are well-positioned to help them understand their various options,” Mr. Brown emphasized.North Sydney Mortgage Broker Speed Lending offers expert guidance and support. Visit their landing page at About Us or Click here to calculate your borrowing capacity by yourself.