Steven Deare
(Australian Associated Press)
First home buyers are flooding the Australian market in their greatest numbers since 2009.
The newcomers – who are not investors – took out 9,945 loans in January as the home lending market continued its boom.
This was a 3.2 per cent rise on the previous month.
The seasonally adjusted figures were part of the Australian Bureau of Statistics’ lending report for January.
The federal government’s First Home Loan Deposit Scheme, introduced in the same month, is believed to have prompted many to enter the market.
The government provides a guarantee to lenders so that first home buyers can purchase a home with a deposit of as little as five per cent.
Louisa Sanghera, director of mortgage broker Zippy Financial, said people had been making use of the scheme.
Many were aware they needed to act quickly due to the scheme’s limited allocations, she said.
Buyers have also benefited from low rates.
The Reserve Bank this month cut the cash rate to a record low 0.5 per cent to help the economy overcome the impact of the coronavirus.
Still, first home buyers are substantially fewer than the horde that came during the global financial crisis.
There were 17,097 loans to this category in April 2009.
The federal government had a first home buyers scheme then too.
Meanwhile, the January data also shows home loans have grown in value by the fastest rate since mid-2019.
The value of new loans grew by 4.6 per cent to $20.73 billion.
The result beat market consensus of 3.0 per cent.
Owner-occupiers were responsible for most of the growth. These buyers took on 5.0 per cent more, which resulted in loans of $15.03 billion.
The bureau’s chief economist, Bruce Hockman, said this category had its eighth consecutive month of uninterrupted growth.
The investor category rose by 3.6 per cent to $5.70 billion.
Personal fixed-term loans increased by 2.0 per cent to $1.83 billion.
The housing sector has proven immune to the economic consequences of the coronavirus, which is placing strain on many businesses.
The January result follows a strong finish to the year, in which the value of home loans for December surged by 4.4 per cent.
