 Rush of first home buyers slows
The rush of first home buyers seen earlier this year appears to have slowed down, according to new data.
The Australian Finance Group said the percentage of all new loans going to first home owners was at a peak of 28.1 per cent in March. This number then dropped to 27.7 per cent in April, and down to 24.8 per cent in May.
The numbers seem to indicate that the boost to the first home owners grant is loosing it's touch.
"While the first-home buyer figure is still well above trend, it suggests an end to the artificial boom created in the sector by the uncertainty around the extension to federal grants, and tougher credit guidelines now being applied by lenders,'' AFG said in a statement.
The grant was increased in October by the federal government. The grant was doubled to $14,000 for established homes and tripled to $21,000 for new homes. The boost will be reduced in September until the end of the year then it ends.
The boost, along with historic-low interest rates, has been credited for creating strong demand for home loans, which have increased for six consecutive months to March, when they rose 4.9 per cent, seasonally adjusted.
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