First home buyers and investors are playing a large part in the market currently and it’s absolutely fantastic to see. Naturally with this sort of activity we can expect to see a slight reduction in the average sale price due to more volume in the lower end of the market. Having them back and buying is interesting though because they are not necessarily using the traditional methods of getting their deposit together. We are increasingly seeing creative ways to come up with deposits outside the normal ‘save it’ or ‘borrow it from Mum and Dad’.
What we are now seeing is two or three and sometimes more parties, all with a desire to get into the property market, working together to make this possible. Some are reporting organising groups who invest, hold the property for more than 5 years to avoid the Brightline clause of having to pay capital gains tax and hoping at the end of their tenure of ownership, they have created a tidy amount from the property.
I say, if it brings more people into their own home then bring it on. Our auction room is full of determined young buyers and this results in many people emotionally engaged in hoping they secure a property. I know mortgage brokers have been busy and that is a great thing for our kids and grandkids!
Watch this space for more on what we are doing to assist people into property.