Migrants flood first home buyer market

The first home buyer market is down but not out, as an increasing number of migrants choose to set up home on Australian shores. According to data from the Australian Bureau of Statistics (ABS) and BIS Shrapnel, net overseas migration reached record levels in the 2009 calendar year – peaking at 285,300.

BIS Shrapnel managing director Robert Mellor said that FHB numbers had dropped 33% since this time last year, and that number is widely expected to eclipse 50% by the end of 2010.

“We’ll come back from around 200,000 first home buyers last calendar year to this calendar year with potentially around 130,000 - 140,000 first home buyers,” Mr Mellor said.

But despite the impending fall in FHBs, Mr Mellor said migrants will give a boost to the market over the coming years.

“The bottom line is that there are more people moving through the first home buyer market than we have seen for a long time,” he said.

“And all these migrants that have come in the last five years are potential home owners.”

Mr Mellor said the recent legislative changes to Australia’s foreign ownership laws have made it easier for residents to buy property.

“You are now allowed to purchase property if you have temporary status in Australia, so I suspect there are a lot of people out there who are potential first home buyers,” he said.

Mr Mellor also said that permanent migrants who came to Australia over the last couple of years would also add to FHB numbers.

“It’s not as if we’ve satisfied all our pent-up demand for first home buyers by getting 200,000 first home buyers into the market last year – there’s still a lot of demand to come through for first home buyers.

“So long as we’re operating at interest rates below 8 per cent, which we should be for quite some time, then I think that might be a good improvements after a temporary setback over the next six to maybe 12 months.”

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