FIRST HOME BUYERS


The 2013–14 Survey of Income and Housing (SIH) collected a range of information on those households who purchased a dwelling in the three years prior to the date of the survey interview. This enables analysis on two groups of recent purchasers - those who purchased their first home (First home buyers) and those who had previously owned a home (Changeover buyers). While not intended to provide a measure of the prevalence of First home buyers, the SIH allows for comparative analysis of demographic and housing cost factors associated with these two groups.


RECENT HOME BUYERS

In the 2013–14 SIH, approximately 895,700 households had purchased the dwelling they occupied in the three years prior to their interview. This figure was 988,140 in the 2011–12 SIH and 1,073,800 in the 2009–10 SIH. In the 2013–14 SIH, 34% of recent home buyers were first home buyers and 66% were changeover buyers.

As shown in Graph 1, most first home buyers were in households with a reference person aged under 35 years (60%). Only 14% of first home buyer households had a reference person aged 45 years and over. In contrast, 54% of changeover buyer households had a reference person aged 45 years and over.



Of all First home buyer households, 93% owned their home with a mortgage. Couple families with dependent children and couple only households made up the majority (63%) of first home buyers. A further 19% were lone person households.

First home buyers were less likely than changeover buyers to purchase a separate house (75% to 86%) and around 15% of the dwellings they purchased were new.

The median value of recently purchased dwellings was $421,000 for first home buyers and $510,000 for changeover buyers, as shown in Graph 2.

While first home buyers on average purchased cheaper dwellings than changeover buyers, they had significantly more mortgage outstanding. The median amount of mortgage outstanding for first home buyers was $300,000, while the median mortgage outstanding for changeover buyers was $229,000. This reflects first home buyers on average having to borrow substantially more to purchase the first dwelling.



The ability to service mortgage repayments has recently been assisted by lower interest rates for home lending. The proportion of gross weekly income spent on housing costs (e.g. mortgage payments, rates) for first home buyers remained stable between 2011–12 and 2013-14 at 21%. This is significantly higher than for change over buyers, who spent on average 16% of their gross weekly income on housing costs.



Due to differences in house price and mean gross household income across greater capital cities and rest of state areas, housing costs as a proportion of gross weekly income for first home buyer households varied by location, as shown in Graph 3. Those first home buyers who purchased in Sydney paid 24% of their gross weekly income in housing costs, with those in Perth paying 17%.