1301.0 - Year Book Australia, 2012
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 24/05/2012
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Statistics contained in the Year Book are the most recent available at the time of preparation. In many cases, the ABS website and the websites of other organisations provide access to more recent data. Each Year Book table or graph and the bibliography at the end of each chapter provides hyperlinks to the most up to date data release where available.
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HOME BUYERS
For most Australians, buying a home involves raising a deposit and then borrowing a substantial amount of money from a bank or other lending institution, which then holds a mortgage on the property. The amount borrowed is influenced by a number of factors including the price of the property, the amount of the deposit, the policy of lenders regarding borrowing limits and the ability of the borrower to repay the loan. The last is, in turn, influenced by household income and housing loan interest rates.
During the period from 1994–95 to 2010–11, the number of dwellings financed has grown overall. In 2010–11, banks and other lending institutions financed 580,000 dwellings for owner occupation, 68,000 fewer than in the previous year, but still 28% higher than in 1994–95. While the number of established dwellings financed grew from 348,000 in 1994–95 to 496,000 in 2010–11, the number of new dwellings financed for construction or purchase declined from 103,000 to 83,000 over the same period (although there was a jump to 104,000 in 2009–10) (graph 10.14). In 2010–11, new dwellings represented 14% of all dwellings financed in Australia. Western Australia had the highest proportion of new dwellings financed (20%) and New South Wales had the lowest (10%).
Between 2002–03 and 2010–11, project home prices increased by an average of 40%, while established house prices increased by an average of 71%. Movements in established house prices were more volatile. They increased from 2002–03 to 2003–04, levelled off in 2005–06, again increased until 2007–08, then declined slightly in 2008–09 before rising again to their 2010–11 level (graph 10.15).
Average loan sizes increased along broadly similar lines to house prices between 1994–95 and 2010–11. For most of the period, the average loan size for first home buyers was slightly less than for changeover buyers (graph 10.16). However, in 2008–09, first home buyers' average borrowings slightly exceeded those of changeover buyers, before dropping back below them in the two subsequent years. In 2010–11, first home buyers borrowed an average of $281,000, which is $45,000 less than the average loan size of changeover buyers, the largest such difference since the series began.
Differences in average loan sizes between states and territories tended to reflect differences in median house prices (table 10.17). Average loan sizes in 2009–10 were highest in New South Wales ($302,000) and Western Australia ($290,000), and lowest in Tasmania ($194,000).
(a) A new dwelling is one that has been completed within twelve months of the lodgement of a loan application, and the borrower will be the first occupant.
Between 1994–95 and 2009–10, the average real disposable income of households who were lone persons under 35 years increased by 65%. That of couple only households with a reference person under 35 years increased by 45%, and that of couples with dependent children increased by 66% (graph 10.18). In the same period, the average loan size, after adjustment for inflation, increased by 99%.
Approximately 1.1 million Australian households bought a home in the three years prior to the 2009–10 Survey of Income and Housing (which was conducted during the 12 months ended June 2010). Of these, 40% were first home buyers and most were young households with a reference person aged under 35 years (67%) (table 10.19). About 10% of first home buyer households had a reference person aged 45 years and over. In contrast, more than half (52%) of changeover buyer households had a reference person aged 45 years and over.
Changeover buyers are often able to use the substantial equity in their previous dwelling as a deposit on a more expensive 'upgrade'. Many will be able to discharge their mortgage quickly and some may not need to borrow at all. In 2009–10, the estimated median value of dwellings occupied by changeover buyers was $450,000 compared with $370,000 for first home buyers. While changeover buyers had slightly larger outstanding mortgages than first home buyers, the proportion of owners with a mortgage was lower (73% compared with 93%).
Consequently, average weekly housing costs of changeover buyers were lower than for first home buyers – $387 compared with $460. Changeover buyers also spent a smaller proportion of household income on housing than first home buyers – 18% compared with 23%.
* estimate has a relative standard error of 25% to 50% and should be used with caution
(b) Recent home buyer households in which neither the reference person nor their partner had previously owned a dwelling.
(c) Recent home buyer households in which either the reference person or their partner had previously owned a dwelling.
(d) A dwelling is new if it was built under contract for the current owner or purchased from a builder/developer and the current owners are the first to live in it.
(e) Householder's own estimate of the market value of their dwelling at the time of the survey.
(f) Only includes owners with a mortgage.
(g) Includes all family and household groups.