Owner Occupiers Not Responding to Rate Cuts

Posted on April 16th, 2013 · Posted in News

The Real Estate Institute of Australia (REIA) says the latest housing figures released by the Australian Bureau of Statistics (ABS) show that owner occupiers are not being drawn back to the market by current interest rate cuts while investors are more responsive.

Housing finance figures for February 2013 show, in trend terms, that the number of owner-occupied finance commitments fell by 0.5% – the fifth consecutive monthly drop.

“The proportion of first home buyers in the number of owner-occupied housing finance commitments decreased by 0.6% to 14.4% compared to the revised figure for January of 15.0%. The proportion remains persistently low compared to the long-run average proportion of 20.1%”

“In large part, this drop can be attributed to some State Governments withdrawing previous levels of support for first home owners buying existing dwellings.”

The value of investment housing commitments rose by 1.5%, in trend terms, in February resulting in the ninth consecutive monthly increase. “It is a concern that owner occupiers are not responding to the easing in monetary policy. Of particular concern is the drop in first home buyers to the lowest level in over eight years,” concluded Mr Bushby.

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