TASMANIANS are pocketing more of their income with mortgages and rents becoming more affordable.
But the number of local first home buyers decreased significantly in the June quarter, down 8.2 per according to the latest REIA Housing Affordability Report.
But there are signs that dismal figure is turning around, according to Master Builders Tasmania.
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Building approvals data for July, which were not counted in the June quarter figures, shows that buyers are starting to take advantage of the generous government stimulus packages, which could total as much as $45,000 thanks to the Tasmanian Government’s $20,000 first home buyers grant and the Federal Government’s $25,000 HomeBuilders scheme.
Those financial incentives are also on top of the First Home Loan Deposit Scheme and various state concessions.
1st year carpenter apprentice Oscar Bresnehan (front) with Master Builder’s chief executive Matt Pollock and 3rd year carpenter builder’s apprentices Joel Millhouse. Picture: RICHARD JUPE
“Dwelling approvals totalled 321 in July, a jump of 50 per cent compared to June, and 28 per cent above the total number of dwelling approvals in July 2019,” Master Builders Tasmania executive director Matthew Pollock said.
“HomeBuilder has boosted confidence in the residential sector which is starting to show up in the approvals numbers.
“We should see more HomeBuilder supported activity showing up as new dwelling approvals towards the end of the year.”
generic pic of builder inside new house under construction
In the June quarter, first home buyers in Tasmania made up a tiny 1.9 per cent of all first home buyers in Australia, according to REIA.
The average loan to Tasmanian first home buyers also increased to $303,089, an increase of 0.3 per cent over the quarter and an increase of 1.7 per cent compared to the June quarter 2019.
Mr Pollock said low interest rates were also helping to boost the debt servicing capacity of Tasmanian households.
“Which means for those with the required savings it’s still a very good time to be investing in that new home.” Mr Pollock said
Wilson Homes CEO Tim Ribbons said the market tightened significantly in March and April, the height of the lockdown, but picked up significantly in July.
He said the government stimulus packages had boosted confidence in buyers and the industry, with Wilson Homes now expecting to post a record-breaking year for new home deposits.
“In June we took 27 deposits. In July and August we have taken about 150,” he said.
Mr Robbins said first home buyers made up about 75 per cent of those new home deposits.
“Around Hobart they are looking at Brighton, Kingston, Austins Ferry,” he said. “Elsewhere its places like Devonport and around Launceston.
“Compared to this time last year (before COVID-19) we are well up.”
Meanwhile, the REIA report also found that rents in Tasmania had become more affordable over the last quarter, with the proportion of income required to meet median rents decreasing to 28.5 per cent, a decrease of two percentage points over the quarter and a decrease of 1.4 percentage points compared with the June quarter 2019.
This is believed to be the result of more properties entering the rental pool due to the impact of closed borders on short-term accommodation providers such as Airbnb, forcing more stock into the market.
Nationally, REIA president Adrian Kelly said rental affordability had improved in both the June quarter and the past year.
“Rental affordability has not been this high since December 2007, a positive for renters in these COVID times,” he said.
In terms of mortgages, the proportion of income required to meet home loan repayments in Tasmania also decreased to 29 per cent, a drop of 0.6 percentage points over the quarter but an increase of 1.7 percentage points from the June quarter 2019, according to the REIA report.
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