Almost half of all Millennials believe now is a good time to buy property, but a third of all Australians are unsure, a survey has found.
Research commissioned by major brokerage Mortgage Choice revealed that Australians hold mixed views about buying a home in the current property market.
A survey of 1,000 respondents found that 45 per cent of Millennials agree that now is a good time to purchase property, compared with 42 per cent of all respondents across all age groups.
However, 30 per cent of the respondents said they were unsure if now is an appropriate time to buy property, while 28 per cent said they believe the current market is not ideal for purchasing a home.
Commenting on the survey results, Mortgage Choice CEO Susan Mitchell said record-low interest rates and surging property prices have left home buyers conflicted about whether the current property market is offering strong home buying opportunities.
“On one hand, home loan interest rates are at historic lows, and this has pushed the financing cost of a home down to record lows. At the same time, property values are surging, and this is likely to be driving significant ‘FOMO’ (fear of missing out) activity among buyers who are concerned about being priced out of the market altogether if they don’t act fast,” she said.
The survey results have followed the release of data by CoreLogic, which found that home values rose nationally by 2.8 per cent in March 2021, marking the fastest monthly gain in over three decades.
However, the rate of growth slowed in April, with CoreLogic figures released this week showing that values increased by 1.8 per cent.
Despite the slowdown in growth, CoreLogic noted that every capital city and “rest-of-state” region have continued to record a rise in dwelling values over April.
The Domain House Price Report for the March 2021 quarter showed that nationally, house prices reached a new record high of $899,509 across the capital cities. House prices rose by 5.7 per cent over the quarter, marking the highest rise in almost 18 years (with prices rising across all capital cities).
Ms Mitchell said: “The current market makes it especially critical for home buyers to speak with a home loan expert.
“Rising auction clearance rates, which CoreLogic says were consistently above 80 per cent during March, may be adding to buyer uncertainty. Having home loan pre-approval is an important step for home buyers, especially when buying at auction.
“Pre-approval provides a clear bidding limit, and this can be a valuable confidence booster.
“Not all lenders offer pre-approval, and the conditions vary among those that do.”
The CEOs of the big four banks recently outlined their house price forecasts over the next few years during their recent appearance before the House of Representatives economics standing committee as part of the Review of the Four Major Banks and other Financial Institutions.
ANZ CEO Shayne Elliott predicted a 17 per cent rise in prices this year, while Commonwealth Bank of Australia (CBA) CEO Matt Comyn said CBA has upgraded its property price growth forecast for calendar year 2021 from 8 per cent to 10 per cent, driven by an extremely strong first quarter.
Meanwhile, National Australia Bank (NAB) CEO Ross McEwan said house prices may rise by over 10 per cent this year, while noting that dwelling prices in regional areas were currently up 11.4 per cent, while city property values were up 4.8 per cent.
Westpac CEO Peter King said the major bank has forecast a 10 per cent rise in house prices for 2021 and 2022.
Find out more about the top property and home buying trends in your local area at the Better Business Summit 2021. Places are limited so make sure you secure your place at the five-state event asap!
[Related: Mortgage Choice adds non-major to panel]
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.
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