Property market faces 'atrocious' hit
The 11 per cent drop at the national level marked the fourth consecutive monthly decline for what is considered to be one of the most influential segments underpinning the overall health of the property market.
MacroBusiness economist Leith van Onselen said the first home buyer figures were "atrocious", especially coming during a low interest rate environment and recent price falls. "It's surprising that it's fallen off this much and so consistently," he said.
In contrast, the ABS found the value of finance commitments for investors rose strongly over the month, and are now up 19 per cent in the last year.
"Young first home buyers are leaving the market but baby boomer investors are entering the market. There's a recovery going on but it's built on investor demand," Mr van Onselen said. "It's generally not great for sustainability when young people are not getting in. It's sort of uncharted territory."
In Victoria, where the grant for new homes was withdrawn in the middle of last year, the decline was 22 per cent over the past four months.
Frequently Asked Questions about this Article…
The ABS reported that the number of first-time buyers entering the market fell to its lowest level in two years in January, with an 11% national drop — marking the fourth consecutive monthly decline for this influential buyer segment.
Leith van Onselen said the results were 'atrocious' because the fall came despite a low interest rate environment and recent price falls, and it's surprising the first-home buyer segment has dropped so much and so consistently.
According to the ABS cited in the article, the value of finance commitments for investors rose strongly over the month and are up 19% over the past year, indicating growing investor activity in the property market.
The article says the recovery appears to be built on investor demand: young first-home buyers are leaving the market while baby boomer investors are entering, so recent gains have been investor-led rather than driven by first-time buyers.
Leith van Onselen warned that it’s generally not great for long‑term sustainability when young people aren’t getting into the market — he described the situation as 'sort of uncharted territory,' suggesting potential risks if the buyer base remains skewed toward investors.
In Victoria, where the grant for new homes was withdrawn in the middle of last year, first-time buyer numbers declined by 22% over the past four months, according to the article.
The article highlights two trends investors should note: falling participation from first‑time buyers (an 11% national fall in January) and rising investor finance commitments (up 19% year‑on‑year). Together these suggest current market activity is increasingly investor-driven, a dynamic investors may want to monitor closely.
The article references official figures from the Australian Bureau of Statistics (ABS) for January and commentary from MacroBusiness economist Leith van Onselen, which are the primary sources for the statistics and views reported.
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