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First home buyers are being held “hostage” by investors, according to one finance comparison website.
The value of investor loans in January was five times greater than the value of loans taken out by first home buyers, according to finder.com.au.
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Spokesperson Michelle Hutchison said that trend was likely to continue throughout 2014.
“Investors are holding some first home buyers hostage from the property market as they take advantage of low interest rates and high yields,” she said.
“Investors are stronger in the property market than first home buyers because they can use equity from their existing home and take advantage of low rates to snap up properties faster, while first home buyers are slowed down by the cost of saving for a deposit and upfront fees with no existing equity.”
Ms Hutchison said first home buyers who are not properly prepared for the market “won't get out alive”.
First home buyers need to get their finances in order and shop around for the best loan if they want to compete with investors, according to finder.com.au.
