There’s been a predictably mixed response to the release of CoreLogic figures showing another month of declines in Sydney house prices.
From some there have been howls that the sky is falling, the boom turned to bust, and the imminent collapse of lives and livelihoods.
But there is one group for whom the slow-down we had to have has given cause for optimism. Premier Gladys Berejiklian announced over the weekend that more than 10,000 first home buyers had entered the market since July, when a range of Budget measures to address housing affordability kicked in.
The most significant has been changes to stamp duty, extended to apply to used homes and raising the full exemption cut-off to $650,000 with discounts up to $800,000.
In combination with Federal Government pressure on banks to tighten lending criteria for investors we are now seeing a healthy return of first home buyers, going to auction or negotiating private treaty sales without the same level of competition from investors.
Across Sydney our Richardson & Wrench agents have been helping many young singles, couples and families get out of the rental market or make the big leap of independence out of the family home.
In Marayong, the Blacktown office has seen a young family settled into a delightful $650,000 duplex where their two young children have a yard in which to play with a school just around the corner. Just next door a couple with a newborn will be moving in within days.
At R&W Parramatta a professional couple with a young child were able to move into a two bedroom apartment for just over $400,000, with money left over for renovations.
The R&W Campbelltown office has no shortage of inspiring first home buyers, among them a hard-working 23-year-old who bought a four bedroom home for $618,000 with plans to renovate and maybe invite some housemates to help her pay down the mortgage sooner. In any event she’s able to manage the repayments in her own right and is prepared to put in the hard work to add value to her investment.
This small sample of first home buyer stories illustrates two important points – that first home buyers are active and that there are good quality affordable homes to be found in Sydney.
It is interesting to also note the impact of high housing costs on the national psyche. In Queensland, where prices have not escalated to the extent of Sydney and Melbourne, the latest Ipsos Issues Monitor shows residents rate housing as the fifth most important issue facing the nation.
http://ipsos.com.au/ipsos-public-affairs/the-issues-monitor/
By contrast, NSW residents rate housing as by far the most important issue, with 47 per cent naming it among the top three issues. In the January-March quarter 2015 the Ipsos figure stood at just 32 per cent exactly where it was in 2010.
There is still much to be done to address housing affordability in NSW, finding a solution to both the supply and demand sides of the problem.
Demand is coming off a five year bull run but supply remains an issue with major bottlenecks in the planning system, adding to costs and stymying efforts to dampen price escalation. Land release has been accelerated but there are plenty of obstacles between the Government rezoning land for housing and actually getting to the stage where a house can be built and occupied.
Much of this is occurring within councils, many of which haven’t the resources to handle the scale and complexity of the many subdivisions waiting for their attention.
But progress is progress and the return of first home buyers is a welcome sign that there is hope for the next generation of home owners.
