Homebuyer confidence hits record highs
Homebuyer confidence hits record highs
Posted on Thursday, August 01 2013 at 5:08 PM
Homeowner sentiment is at record levels, thanks to expectations about less mortgage stress.
New figures from an independent survey commissioned by lenders mortgage
insurance company Genworth reveal homebuyer confidence is back – and in a big
way. The confidence index jumped from a record low of 93.4 in March to 100.1 at
the end of July. The 7.2 per cent increase saw the index reach its highest
level since it was first calculated in 2007.
“It appears that consumers are becoming more confident about making
repayments, with the index showing that 29 per cent of homeowners expected
interest rates to decrease over the next 12 months, compared to 12 per cent who
held this expectation in March,” chief commercial officer Bridget Sakr says.
Survey participants were asked about the proportion of their monthly
income used to service debts, the maximum loan-to-value ratio they were
comfortable with, their repayment history over the past 12 months and whether
they believe now is a good time to buy.
The index also suggested that for those looking to enter the property
market, housing affordability and saving for a deposit are the biggest
barriers.
“Research showed that 80 per cent of non-property owners considered it
unrealistic to save a 20 per cent deposit,” Sakr says.
“Homebuyers realise that current market conditions, particularly
historically low interest rates, make buying property and servicing a mortgage
a more attractive proposition than it’s been for a number of years. However,
affordability remains a challenge for those yet to enter the market, with 70
per cent of non-property owners believing the dream of homeownership to be
unrealistic.”
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