The number of owner occupier home loans being taken out across Australia rose 1.6% in March, 2015, though the number of loans taken out in the Northern Territory dropped 0.7%, as the property downturn in Darwin deepens, with house price falls now helping first home buyers to enter the market there, according to Jo Brown, Principal of HomeBuyer Solutions.
According to housing finance the data released today by the Australian Bureau of Statistics (ABS), the value of new home loans taken for investment housing jumped 6.4% in March compared to a 1.6% rise in value for owner occupier housing loans.
That weakness in the NT compared to strength in most other states, with the number of home loans up 1.1% in New South Wales and Victoria, up 2.4% in South Australia, 1.0% in Western Australia and 1.4% in Queensland. The weakness in NTDJ approvals follows several months of falls in housing finance approvals in trend terms, according to the ABS data.
“The softness in the NT is expected to be ongoing through 2015 and house prices are likely to fall more given that the commodity downturn is depressing economic activity and demand for housing. This has, however, made housing more affordable for first home buyers,” said Brown, whose company HomeBuyer Solutions sells house and land packages in Zuccoli, NT, to first home buyers for less than $500,000.“Right now, we’re seeing house prices falling in Darwin, and we will likely see further price falls this year as the mining downturn kicks in, suppressing demand for housing.
The ABS housing finance data clearly shows demand for home loans is still dropping, which will keep downward pressure on house prices in the NT, creating ideal opportunities for first home buyers in the Darwin market,” she said.
Data from property forecasters SQM Research shows that asking prices for houses in Darwin were down 2.7% over the year to 12 May, 2015, while unit prices were down almost 10%. That compares to a rise of 6.1% for asking houses prices Australia-wide and a 6.3% rise for units.
“While first-time buyers make up only 14.7% of the demand for new home loans across Australia according to the latest data, that trend could reverse in the NT given falling house prices and help from the government, which is offering a First Home Owner Grant (FHOG) of $26,000 for those that build their own home. This is a huge grant and it is there for buyers to take advantage of.
“In addition, the NT’s HomeBuild Access home loan products can help. If you are a first home buyer and you don’t have a deposit, if you qualify for the NT Government’s FHOG, you will be able to pay the deposit and have money left over for other expenses,” said Brown.
“So, for those people who are serious about their financial future, they can get all the support they need from the NT government incentives and HomeBuyer Solutions’ Home Buyer Program.
“Our Home Buyer Program is focused on educating first home buyers, and those that don’t fit the normal banking criteria, on how to get into a new home. The software that we incorporate into the management of home loans, our Financial GPS, is a web-based financial education, budgeting, coaching and debt cancellation solution, programmed to aggressively pay off mortgage, credit card and personal loans in record time.
“The system utilises infinitely intelligent algorithms, customised to an individual’s personal financial circumstances, to calculate the fastest way to zero debt,” she said. “All your income will be deposited direct into your new home loan account and the Financial GPS will be set up to leave it sit there for as long as possible. This will reduce the monthly interest payable on the home loan balance, increasing the availability of surplus income to pay down other debt.
“This extra money is then used to pay off the most beneficial debt first, such as high interest credit card balances. After paying off this debt, it will roll the extra money from the payment savings toward paying off the next most beneficial debt. This process will continue until all your debts are paid off, potentially saving you hundreds of thousands of dollars in interest payments,” said Brown. “Moreover, we arrange Debt Cover, which provides protection for first home owners when it comes to protecting their assets against unexpected events. It’s possible that Debt Cover premiums can be much lower when paid from your super fund, and we help home owners take advantage of these little-known benefits such as this.”
Source: HomeBuyer Solutions