Australia Home Loans Demand is Down

Brokers will be put to the test in coming months as consumer appetite for mortgages shrink.

The value of home loans held by Owner Occupiers has dropped by 4.6% during the month of January 2011. This is symptomatic of more investors than home owners being active in the property market.

Furthermore, the number of first home buyer loans declined from 15.8 per cent in December 2010 to 15.2 per cent in January 2011. While this may seem to be a small drop, it is also indicative that fewer first home buyers are ‘taking the plunge’ into property ownership. Certainly the climate of interest rate increases and global disasters has contributed to the drop.

Consumer confidence numbers are down as are sales statistics – people are going into a ’savings’ mode. First home buyers have been affected in more ways than one. First they have lost the First Home Buyer Boost, next they have been exposed to escalating property prices and interest rates and finally they are being asked to come up with sizable deposits and demonstrate genuine savings before being able to qualify for a home loan. It is no wonder that First home buyers have gone into hiding.

Notwithstanding this, there are still good home loans out in the market. All it takes is knowing where to look.

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