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More South Australian first home buyers are choosing to buy an established home rather than build, according to new figures from HomeStart Finance and the Housing Industry Association (HIA).
HomeStart’s lending figures for 2014-15 showed a six per cent drop in the number of construction loans for first home buyers in the last 12 months.
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The HIA is also predicting a decline – new statistics forecast a 10.6 per cent fall in the number of building starts – in South Australia for the 2015-16 financial year.
HomeStart said the move away from building homes could be driven by a range of factors, including the completion of the $8,500 housing construction grant introduced in December 2013, a lack of affordable and available land in inner-suburban areas, and a shift in home buyer preferences.
John Oliver, CEO of HomeStart Finance, said the figures were surprising as building a home offers significant advantages over buying an established home.
“Generally it can be a more cost-effective option to build because you are buying off the plan, and a lower price reflects the inconvenience of waiting for the home to be built. There are also stamp duty savings when you build, as you only pay stamp duty on the land and footings,” he said.
“First home buyers also have access to the First Home Owners Grant, which offers up to $15,000 to those who build or purchase newly constructed homes.”
[Related: FHBs to spend up to 14 years saving]
