First-home buyer numbers drop off
No rush: Fewer first-home buyers are entering the market. Picture: Stephen Harman
Fewer first-home buyers are entering the market. Picture: Paul Loughnan.
THE property industry is shedding first-home buyers at breakneck speed, with a study showing 60,000 fewer buyers forged into the market over the past year.
Research published by RateCity reveals the number of first-home buyers across Australia tumbled nearly 40 per cent in the year to May, down from almost 150,000 to about 90,000.
In Victoria, first-home buyer numbers dropped 37 per cent, from more than 41,000 to about 26,000.
The revelation came as other leading surveys showed a continuing slide in Victoria's house prices and land sales hitting a 10-year low.
National Australia Bank's residential property survey showed home prices had dropped 2 per cent in the June quarter, with Victoria, down 2.4 per cent, and Queensland leading the fall.
In Victoria, NAB's index measuring market conditions tumbled into negative territory, from 16 points to -5.
Prices in Victoria are expected to drop a further 2.4 per cent over the coming year and remain flat for the next two years.
Meanwhile, the Housing Industry Association released figures with RP Data showing land sales have collapsed.
The number of sales fell 6 per cent in the three months to March, down 43 per cent compared with the same quarter last year.
In contrast to housing, the cost of residential land had increased by 4.4 per cent for capital cities and 3.8 per cent in regional areas in the year to March. The weighted median land value was $198,980.
The HIA said excessive government regulation and costs were among reasons pushing land prices higher.
HIA research director Tim Lawless said the undersupply of land meant no real improvement could be expected in the construction industry.
RateCity chief executive Damian Smith said that first-home buyers had brought forward purchases to 2009 to cash in on the temporary boost to the First Home Owners Grant, partly explaining the dive in first-home buyers.
But lingering uncertainty over the outlook for interest rates following increases last year was a prime factor in the shock result, Mr Smith said.
"There is a general lack of confidence in the non mining-boom states. We see it in small business not borrowing to expand and we see it in retail spending."
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