Confidence among first homebuyers is rising despite the threat of higher interest rates and declining housing affordability, according to a new report.
Wizard Home Loans' study showed that about 672,000 homebuyers are planning to buy their first property before mid-2008 - a sharp increase of 70% compared to a year ago.
Potential first homebuyers from Queensland showed the strongest interest, with a 91% rise from 89,000 to 170,000 (March quarter to June quarter this year). Tasmania followed closely with a 70% increase from 7,000 to 12,000 in the same period. First homebuyers in NSW appeared to hold back, with only a marginal increase in buying intentions, while South Australia and Northern Territory have both recorded decreases.
"The data shows that despite the obstacles placed in the way of aspiring first homeowners, they remain undeterred," said Mark Bouris, founder and chairman of Wizard. "Quite simply, Australians are more determined than ever to own property."
According to the report, higher annual household incomes may be a factor in increasing first homebuyer interest. The number of first homebuyers with annual household incomes of more than $100,000 rose to 183,000 in June this year, compared to only 59,000 at the same time last year.
Despite this upbeat result, Bouris cautioned that intent alone doesn't necessarily guarantee immediate results. "It's important to be cognisant of the fact that aspiring homeowners are taking a long-term approach and setting themselves a goal of entering the market within a year, not a month."
