Continuing the findings from the latest DFA household surveys, today we look in more detail at want-to-buys and first time buyers. Both groups are hard pressed. In fact a number of households who were previously looking have stopped (thus moving into the want-to-buy segment); and some want-to-buys have now moved into the property inactive segment, because they are unable to see a path to property ownership. The main barrier for want-to-buys is the high house prices (nearly 50%) and costs of living. In trend terms, as house prices continue to lift, it becomes an ever more critical factor.
Turning to first timers, there is a similar trend, with house prices being the main factor in play. Whilst costs of living impact less this time, we see that finding a place to buy remains a problem for some (and directly linked to the house price issue).
Looking at where they are looking to purchase, the national picture shows that suburban houses are still the first choice, but units are becoming more of a focus, and in the Melbourne and Sydney markets, units are the property of choice (thanks to price differentials). The most striking element is the rise in the “not sure” where to buy category. Clearly it is becoming harder for first time buyers to figure an effective strategy. This explains recent trend data.
Finally, we know that some first timers are leaping directly into investment properties. Units in the city, or city fringe are the preferred investment property options.
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