Investors still backing away from property market

Alex RitchieSep 10, 2018( 2 min read )

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Investors are backing away from the housing market while owner-occupiers are taking a bigger piece of the housing pie, according to the latest ABS Housing Finance figures.

In seasonally adjusted terms, the value of investment housing fell 1.3 per cent to $10 million, in the month between June and July 2018.

Meanwhile, the value of owner-occupied housing grew 1.3 per cent to $21 million in the same time frame.

Further, the number of dwelling commitments for owner-occupied housing grew 0.4 per cent to 52.6 million from June to July 2018 (in seasonally adjusted terms).

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The number of first home buyer commitments as a percentage of total owner occupied housing finance commitments also fell to 18.0 per cent in July 2018 from 18.1 per cent in June 2018.

Comparatively, first home buyer commitments rose from 14.0 per cent in June 2017 to 15.0 per cent in July 2017.

The ABS noted that the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments “recorded strong growth from July 2017 to November 2017” as a result of changes to first home buyer incentive programs in New South Wales and Victoria.

Alex Ritchie

Personal Finance Writer

Alex is a personal finance writer and PR professional at RateCity, and has been writing about finance for over three years. She is passionate about closing the gender pay and superannuation gap, and aims to help young Aussies to overcome their financial apathy and better manage their finances. Alex has been published in numerous print and online outlets, including Money Magazine, Lifehacker Australia, and Business Insider.

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Tip: You can use RateCity how much can I borrow calculator to get a quick answer.

How much money you can borrow for a home loan will depend on a number of factors including your employment status, your income (and your partner’s income if you are taking out a joint loan), the size of your deposit, your living expenses and any other debt you might hold, including credit cards.

A good place to start is to work out how much you can afford to make in monthly repayments, factoring in a buffer of at least 2 – 3 per cent to allow for interest rate rises along the way. You’ll also need to factor in additional costs that come with purchasing a property such as stamp duty, legal fees, building inspections, strata or council fees.

If you are planning on renting the property, you can factor in the expected rental income to help offset the mortgage, but again it’s prudent to add a significant buffer to allow for rental management fees, maintenance costs and short periods of no rental income when tenants move out. It’s also wise to factor in changes in personal circumstances – the typical home loan lasts for around 30 years and a lot can happen between now and then.

Investors still backing away from property market

Related news

First home buyers back at highest level in almost a decade

Home lending lifts, refinancers lead the charge

Home lending bounces back in the lead up to spring

Home lending continues to fall.. but for how long?

Investors go cold on frosty property market

A massive plunge in investors

Today's top home loans products

Discount Offer Variable Home Loan OO P&I ($200k+)

Home Package Plus Personal Fixed Special (Principal and Interest) 2 Years (LVR 80%-90%)

Live-in Variable Loan (Principal and Interest)

Star Essentials Home Loan (Amounts $150k-$850k, LVR < 80%)

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