Login
ISCOVER
Staff Reporter
Buoyed by sound fixed rate discounts, first home buyers are returning to the market at the greatest rate since September 2009.
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
According to the latest AFG Mortgage Index, first home buyers comprised 16.4 per cent of all loans processed – a 40 per cent increase for this buyer category compared to October 2010 when they comprised 11.8 per cent of the mortgage market.
First Home Buyers were particularly active in NSW, where 21.1 per cent of home loans were arranged for them in October, as well as QLD (17.9 per cent) and WA (17.3 per cent).
More mortgage buyers opted for fixed rate loans in October than in any month since March 2008.
Fixed rate loans comprised 20.4 per cent of all home loans processed in October – dramatic growth considering they comprised only 7.9 per cent of home loans as recently as July 2011.
AFG’s general manager of sales and operations Mark Hewitt said buyers were reaping the benefits of a competitive mortgage market.
“Discounted fixed rate loans appealed to all buyer types, but especially first home buyers and those looking to refinance. We have been slightly surprised with the popularity of fixed rates given it has been generally predicted variable rates would decrease and we would now expect the proportion of fixed rate loans to fall, following the cut in variable rates. Non-major lenders are doing increasingly well in this environment and hopefully yesterday’s news will further support a market recovery which is still in its very early stages,” he said.
Non majors have seized more market share than at any time over the past twelve months now comprising 21.1 per cent of all home loans.
Their products are of particular appeal to first home buyers, where almost 30 per cent of the market is held by non-majors, as well as buyers looking to refinance, where non majors account for a 21.2 per cent market share.
