Housing market sentiment is on the rise among young first home buyers (FHBs) who are eager to sniff out COVID deals, according to a ME report conducted in June as social distancing restrictions initially began easing across much of the country.
The bank’s latest Quarterly Property Sentiment Report revealed that 82% of FHBs are hoping to see bargain properties cropping up for sale if the economy continues to worsen. As such, over half (51%) of the same group indicated plans to get onto the property ladder within the year – up nine points on the previous quarter and the highest rate of any demographic surveyed.
“First home buyers may be looking to find a silver lining in the current economic climate, thanks to greater potential for property price falls, record low interest rates and government support,” said Andrew Bartolo, ME general manager of home loans.
“Of course, this will be more realistic for those whose employment and income haven’t been affected as a result of the pandemic,” he added.
Notably, two-thirds (60%) of the FHB respondents indicated they were more likely to consider buying a home in a regional area to save money and improve their lifestyle than they have been in the past.
“New remote and flexible working arrangements brought in to accommodate for COVID-19 have clearly influenced Australians’ sentiment towards buying in regional areas,” said Bartolo.
“It’s now a more feasible option for many and if prices are lower in those areas and you think it will improve your lifestyle – of course it’s an attractive possibility.
“I think many Australians dream about moving to a regional area at some stage during their life, so it will be interesting to see how many do actually decide to pursue a sea or tree change, perhaps earlier than expected.”
While positive sentiment rose six points to 35% for Q3 2020 and worries around how COVID will affect the value of property eased nine percentage points, the majority of Australians still plan on biding their time. Over the next 12 months, 61% of all surveyed across every age group expect to hold steady rather than buy or sell.
“The impact of COVID-19 negatively shifted consumer sentiment towards the property market in the second quarter of the year, but we started to see signs of optimism in June,” Bartolo said.
“Hopefully this renewed positivity and growing confidence is able to weather possible second waves of COVID-19 cases as we’ve seen in Victoria, which is no doubt increasing worry across the nation.”
