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Investor confidence lifts

Homebuyers in Australia are quickly growing in confidence about the property market recovery and are looking to invest in greater numbers than two years ago, according to a survey commissioned by the Commonwealth Bank/Mortgage & Finance Association of Australia.

The Home Finance Index survey showed that almost half (49.8 per cent) of the 1,361 respondents believe residential prices will rise over the next quarter. This is double the number in March 2012 (25 per cent).

Meanwhile, 30.8 per cent of respondents reported that their financial situation has improved over the last year - a rise of 14 per cent over March 2012.

The number of active buyers likely to be in the market for a home loan over the next year has jumped by almost 50 per cent from 12.7 per cent of respondents to 18.9 per cent.

Optimism is being largely driven by flat property prices and continuing falls in interest rates, creating a "buyer's market."

Mortgage & Finance Association of Australia Chief Executive Officer Phil Naylor said that the survey shows that the property market is definitely recovering, with sentiment of both first home buyers and investors improving dramatically.

"The property market is all about confidence and the survey confirms that good times are ahead, especially as interest rates continue to be at historic low levels, creating a situation where mortgage repayments are more affordable than rents in many areas”, added Commonwealth Bank Executive General Manager, Third Party and Mobile Banking, Kathy Cummings.