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Gen Y first home buyers eye investment market
Released 22 August 2011

Generation Y first home buyers are increasingly targeting investment properties as their entry point into the real estate market, according to mortgage broker Loan Market.    

Loan Market Chief Operating Officer Dean Rushton said in the past month the company had experienced a five per cent rise in enquiries from first time buyers, with a significant number interested in investment properties.

“Among all of our enquiries from first home buyers there has been a 15 per cent rise in the number of them looking to purchase an investment property,” Rushton said.
“Many of these buyers are trying to take advantage of the high rental yields around the country and get into the market with an investment property.”

Rushton said Generation Y, born after 1981, made up a large number of the first home buyer enquiry.
“Gen Y is still chasing the great Australian dream of home ownership but many are approaching their entry to the market from a different angle,” he said.

“An investment property also gives them the option to buy property where they can join forces with a family member or friend to purchase.

“If they can muster a healthy deposit and take advantage of some of the interest rate specials on offer from lenders they could well be positively geared on the investment.”

Rushton said official interest rates staying on hold at 4.75 per cent since November last year had also resulted in an increase in enquiries from first time buyers.

“We have gone nine months without an interest rate rise by the Reserve Bank of Australia and this has not only given a much needed reprieve to households dealing with increased living costs but has encouraged first time buyers,” he said.

“The prospect of the RBA lowering rates in response to the latest global economic downturn could boost consumer confidence and increase activity in the home finance sector.”