Despite a recent rate rise and record low levels of housing affordability, Australian first home buyers are expected to continue growing their share of the Australian mortgage market.
A new report by independent market analyst Datamonitor shows that lending commitments to first home owner-occupiers have grown from AUD$17.1 billion in 2003 to AUD$29.2 billion in 2006, and are forecasted to increase to AUD$45.9 billion in 2011.
“Over the past few years, first home buyers have been helped back into the mortgage market by innovations in the mortgage industry, although most customers still prefer to take out traditional mortgage products,” says analysts from Datamoniter.
Although some new products are more costly and risky for borrowers, and credit requirements may tighten due to the global credit crisis, more first home buyers are expected to climb the property ladder.