Property interest remains high despite housing affordability being an increasing concern for FHBs, according to the 2015 QBE Barometer report.
The report showed that low interest rates are continuing to support Australians’ appetite for property, with a greater number of buyers expanding their options when purchasing their first home.
“In June 2014 FHBs were each open to an average of 1.8 different types of property while at February 2015 it had increased significantly to 2.4, with the trend most noticeable for houses and townhouses,” the report said.
While FHB appetite remains high, housing affordability continues to be a concern, with the report noting property prices increased 7.4 per cent across the capital cities over the past year.
According to the report, 47 per cent of mortgagors and intenders believe property will become increasingly unaffordable, while 82 per cent said future generations will find it difficult to purchase their first home.
Fifty-three per cent think it’s more important to get into the property market now than to wait and save a bigger deposit, while 29 per cent stated prices are so high they cannot afford what they want.
Affordability appears to be particularly concerning for FHBs, with over half stating that property is substantially over-valued, while 58 per cent fear they will never be able to afford their own home, according to the report.
“Recent changes to FHB grants have restricted their applicability to new dwellings in most states and this, as well as high prices, may have impacted FHBs’ ability to enter the property market,” the report said.