New lending data reveals the demand for home loans remained relatively flat in April.
Housing finance figures from the Australian Bureau of Statistics (ABS) found that 52,109 loans were processed in April in seasonally adjusted terms, up marginally from 52,104 loans in March.
The total value of all dwelling commitments climbed 1.7 per cent and owner-occupied commitments rose just 1.4 per cent over the month.
Mortgage Choice spokesperson Jessica Darnbrough said the statistics were relatively unsurprising given that recent research by RP Data shows property values started to moderate in April.
“After a surge in value over the first quarter of 2014, research conducted by RP Data showed a marked slowdown in capital gains in April, with dwelling values rising just 0.3 per cent over the month,” Ms Darnbrough said.
“This reduction in the rate of capital gains across the combined capital cities housing market brings growth back into a more sustainable range, which should come as a welcome relief for first home buyers,” she said.
The number of first home buyer commitments as a percentage of total owner-occupied housing finance commitments fell to 12.3 per cent in April from 12.6 per cent in March, according to the ABS.
However, Ms Darnbrough said she is optimistic that the property market will start to see more first home buyers filter through as the pace of capital gains continues to cool over the coming months.
“Many first home buyers have been priced out of the market in recent months and, as such, they have been forced to sit on the sidelines,” she said.
“That said, if the pace of capital gains continues to cool then we could see more first home buyers entering the market.”
According to RP Data’s May Home Value Index, capital city dwelling values fell 1.9 per cent over the month, the first drop in dwelling values over the past 12 months.