Rate cuts boost homebuyer sentiment

Rate cuts boost homebuyer sentiment

Posted on Friday, May 18 2012 at 3:38 PM

Buyers in Australia are more confident about buying a house or apartment now than they were six months ago, according to the latest CBA/Mortgage and Finance Association of Australia Home Finance Index.

The index shows Australian
households are at their highest levels of financial confidence since May 2011.

The survey of
1447 people also found 51.7 per cent of homebuyers believe now is a good time
to buy a new home, compared with 36.1 per cent six months ago.

Fewer respondents
feel financially worse off in March 2012 (35.1 per cent) compared with 38.8 per
cent six months ago.

optimism is being driven by flat property prices and lower interest rates, both
creating a ‘buyers’ market’. Increasing rents have also led more than two
thirds of first homebuyers (65.4 per cent) to re-evaluate the trade-off between
renting and buying.

Mortgage and
Finance Association of Australia chief executive officer Phil Naylor says the
renewed confidence is a positive indicator for the mortgage market.

“While the cost
of living pressures and employment uncertainty are placing a strain on some
households, these concerns are balanced by positive factors such as lower house
prices and interest rate cuts,” he says.

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