First Home Buyer can be classified as Investors

[keithj]

There's been a couple of news items suggesting that there are more FHBs than the ABS stats suggest. A significant proportion appear to be buying their 1st property as an investment rather than as a PPOR - consequently the ABS considers then investors rather than FHBs.

For every two first-home buyers intending to live in their new home, there's another one entering the market for the first time as an investor.
Figures released by NAB on Wednesday show eight per cent of new homes and nine per cent of existing homes sold in the final quarter of 2014 were bought by people purchasing their first home as investors.

....

Have the brokers noticed any particular increase in FHBs going for an IP rather than PPOR ?

 

[Peter_Tersteeg]

People buying their first home to get grants and concessions, then turning them into IPs after 12 months has been quite common for a long time (in my experience).

It's dropped off recently, probably because the price point of most capital cities make them unaffordable for this demographic. Most people are investing further away from where they prefer to live.

As for a more statistical representation of the market as a whole, it's hard to say. Somersoft tends to attract people wanting to invest, so clearly the forum would be skewed on this issue.

 

[Corey Batt]

For every FHBer buying a PPOR, i've been writing 5 FHBer's buying investment properties. Obviously my business works from an investment niche, but those numbers are still very telling.

The common plan is to purchase investments early on, generating sweat equity whilst saving and building a portfolio - so they can then buy their dream PPOR without feeling they have neglected their financial futures. This is in contrast to the older notion of working your way up the property ladder through cumilatively more expensive properties - only to pay extortionate stamps, LMI and selling fee's at each step.

 

[Marty McDonald]

Not to be a told you so but I tried to raise this and the fact that without the grant on established property (the majority of purchases) the lenders had no way of reporting their true FHB numbers to the ABS.

This fell on deaf ears until one of the aggregator heads also raised this possibility. 2 years later the ABS has revised their stats methodology.

 

[Redom]

Yep see it a lot. I have a large percentage of my clientele in the <35 yold bracket, most of the first timers are purchasing investments. Im finding more and more willing to look outside their home state too.

Cheers,
Redom