Amidst changes to stamp duty requirements in states like Victoria and New South Wales, research has emerged showing a sudden return to the market from first home buyers.
The study, produced by CoreLogic, has shown that, in August 10,227 first-home buyer committed to owner-occupier purchases, the largest number since December 2009. This represented the highest proportion of commitments since 2013, at 17.2%.
It’s believed that this research shows stamp duty changes are already having a positive impact on the market. It’s shown that stamp duties could well be a primary barrier to first-time buyers entering the market, and these recent changes have had a stimulating effect.
Effective since July 1st, these changes have meant that first-time buyers purchasing properties below $600,000 in Victoria and $650,000 in NSW don’t have to pay any stamp duty at all.
In addition to this, stamp duty concessions are available in NSW up to $800,000, with Victoria following suit at $750,000. As a result of this, the number of first-time buyer commitments between June and August has risen by 34% in Victoria and 59% in NSW.
First-time buyers have also been buying more properties in WA and NT, two areas which recently have seen drops in property prices, creating opportunities for them to get their feet firmly on the ladder. Queensland and ACT have also seen a rise in demand from first-time buyers, an event occurring alongside a moderate increase in property prices.
First-Time Buyer Activity by State
Here’s how the increase in first-time buyer commitments has looked for each state:
New South Wales
2,426 first-time buyer commitments in August sits at the greatest monthly number since the first month of 2012. In August, first-time buyers made up 12.9% of all owner-occupier commitments, the highest proportion since October 2012.
3,162 first-time buyer commitments in Victoria accounted for 18.3% of all owner-occupier commitments.
August 2017’s number of 2,190 was higher than July’s, but lower than the June number. However, August’s commitments was 17.9% higher than the long-term average.
490 first-time buyer commitments was higher over the month, but sat at 17.7% than the state’s average. In South Australia, first-time buyers accounted for 12.7% of all commitments.
First-time buyers accounted for 26.2% of all owner-occupier commitments at 1,589, the highest number since June 2015. This number is 17.7% higher than their long-term average.
Tasmania saw 129 first-time buyer commitments in August 2017, which was 22.3% lower that their long-term average. These first-time buyers accounted for 12.3% of all owner-occupier commitments.
60 first-time buyer finance commitments accounted for 20.5% of all owner-occupier commitments for the month. This, however, was 28.6% lower than the average 84 commitments the state has seen in the long-term.
Australian Capital Territory
231 first-time buyer commitments in August put ACT at 47.7% higher than their long-term average.