According to some weather reports, NSW was the hottest place on earth on the weekend, with Sydney suburb Penrith setting an all time record temperature for the suburb on auction Saturday with temps hitting 46.9. But it wasn’t just Sydney’s weather that was hot on the weekend. The property market was just as hot…..if not even hotter. According to CoreLogic data (see below) Sydney’s property prices keep rising (up 17% over the last 12 months) and the properties for sale keep on selling (the weekend clearance rate was a very high 85%).
Across Sydney there are hundred’s of stories of first home buyers getting out-bid by investors. FHBA co-founder Taj Singh said “at the end of the day you are controlled by your own budget. If a property is selling for more than you can afford you have little choice but to accept that it’s not meant to be, at least not at the current time and place. Your options are to consider areas where you can afford, or, save longer. Other options may include talking to parents about various forms of financial assistance”.
While Sydney had the hottest property market on the weekend it wasn’t the only market that was tough for first home buyers. Adelaide and Brisbane had stronger auction clearance rates than in previous weeks, while Melbourne was typically tough for first timers as well.
Last week the Reserve Bank of (RBA) kept interest rates at a record low which will be popular with the large number of investors in the market. With investors continuing to dominate the property market, what needs to be done to address housing affordability for first home buyers?
News affecting first home buyers
Here are the top stories affecting first home buyers this week:
- Gen Y concerned about the future – A new study has found that Gen Y Australians are amongst the world’s most pessimistic and according to experts housing affordability is a big reason why. FHBA co-founder Taj Singh spoke to NewsCorp late last week about the housing affordability problem and how it affects people’s confidence read more on news.com.au
- Is ‘rentvesting’ really going to help me? – Rentvesting is the word of the month, perhaps the word of the last 12 months, in the real estate arena. Rentvesting, which involves buying an investment property in a cheaper area than the area you need to live in while you rent where you need to live, has plenty of fans as a strategy for first home buyers to enter the property market sooner. However, like with any investing strategy, there are risks with rentvesting that you should be aware of. FHBA fan Andrew Gibietis spoke to Domain about his concerns as an aspiring first home buyer in Sydney. He was joined by FHBA co-founder Daniel Cohen read more in Domain
- FHBA’s Daniel Cohen to speak at housing affordability event – FHBA’s co-founder Daniel Cohen has been invited by political party Sustainable Australia to make a keynote speech at a public housing affordability summit in Sydney. Titled ‘Housing Affordability: An honest debate’ the event will be open to the public, but you must RSVP read more in FHBA News
FHBA fan Andrew Gibietis is concerned about ‘rentvesting’ Source: Domain
Capital City Price Movements
The CoreLogic RP Data Daily Home Value Index (as at 13/February/2017):
- Adelaide – 4746.23 (Qtr + 0.11% / Yr + 5.05%)
- Brisbane – 551.47 (Qtr + 0.34% / Yr + 4.23%)
- Melbourne – 868.36 (Qtr + 1.52% / Yr + 11.64%)
- Perth – 581.18 (Qtr + 0.74% / Yr – 2.76%)
- Sydney – 1071.44 (Qtr + 3.27% / Yr + 17.06%)
Weekend Auction Clearance Rates
Interest Rates Update
Last Tuesday the Reserve Bank of Australia (RBA) board meet for the first time in 2017 to review the cash rate. The RBA opted to leave the cash rate on hold at 1.50%.
- Read more on the RBA’s decision
- Compare a range of savings account rates
- Compare a range of home loan rates
New Homes of the Week
With Valentine’s Day tomorrow, the latest edition of FHBA New Homes of the Week (edition 41) focused on First Home Owner Grant eligible homes that are suitable for young couple first home buyers. The winning homes are not only affordable but are also special for spending time in with your loved one.
Tweet of the Week
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First Home Buyers Australia