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First home buyer confidence has increased in one state, despite rising house prices and economic uncertainty, a new report has revealed.
According to the latest HomeStart Finance First Home Buyer Index, South Australian first home buyer sentiment has increased by 8.6 per cent from October 2015.
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HomeStart Finance CEO John Oliver said the results were surprising given the challenges many first home buyers face when trying to break into the housing market.
“The results were unexpected because anecdotally the view is that it is more difficult than ever for first home buyers to break into the housing market,” he said.
“What these results tell us is that even though rising house prices and high upfront costs make buying your first home challenging, home buyers are growing in confidence about the prospect of achieving the great Australian dream.”
Mr Oliver noted that the result was largely driven by the ease of market entry in South Australia, with first home buyers less concerned about potential barriers such as the deposit size required, as well as further fees and charges.
“Previous research has shown that the upfront costs, such as the deposit and fees, are one of the largest barriers to home ownership,” he said.
“However, the increased positivity expressed about the ease of market entry highlights that first home buyers are less concerned about these factors at the current time.
“The Index also suggested that home buyers are confident that there will be no significant changes in the next 12 months that will impact on their chances of buying a home, such as increase in property prices, rental prices, and fees and charges for home loans.”
The Index also found there was an 8.6 per cent increase in the perceived affordability of housing in South Australia and a 4.9 per cent rise in sentiment about now being a good time to buy a home, compared to October 2015.
South Australia’s unemployment rate still remains an area of concern for many first home buyers, with sentiment towards employment security only recording a 3.1 per cent increase, the lowest score in the Index.
