First Home Buyers Rush to the Regions


Up to almost 40 per cent of first home buyers taking advantage of record levels of government assistance during the past year have purchased homes in regional areas, new data has revealed.

The latest figures from the National Housing Finance and Investment Corporation reflect the pandemic-induced surge of interstate migration to the regions.

Of the applications for support under the First Home Loan Deposit Scheme (FHLDS) and New Home Guarantee (NHG), 37 per cent and 25 per cent respectively were for the purchase of homes in regional areas.

“The interstate migration to the regions is particularly noteworthy and reflects a trend we have seen since Covid,” NHFIC chief executive Nathan Dal Bon said.

“This is particularly pronounced in Queensland, which has been the greatest benefactor of interstate migration.”

According to the new data, demand relative to population share for the federal government’s deposit schemes was strongest in Queensland, which accounted for 26 per cent of FHLDS guarantees issued and 27 per cent of NHG.

Overall, 22,879 home purchases across Australia have been supported by the FHLDS and NHG, helping almost 33,000 people acquire their first home since January, 2020.

The top two states supported under the schemes were NSW (11,000 residents) and Queensland (9000 residents).

One in 10 of all first-time homeowners in Australia in 2020-21 tapped into the initiatives, with 58 per cent of all buyers aged under 30 and the schemes enabling them to bring their home ownership aspirations forward by an average of at least four years.

▲ Almost 23,000 first home purchases across Australia have been supported by the FHLDS and NHG since January 2020.
▲ Almost 23,000 first home purchases across Australia have been supported by the FHLDS and NHG since January 2020.

The latest data also indicates buyers over the past year have been willing to move further away from their existing residence to buy their first home. On average, buyers moved 8.4km away from their previous residence under the FHLDS and 13km for the NHG.

By postcode, demand for the FHLDS was strongest in Melbourne’s north-west (particularly Craigieburn, Mickleham and Donnybrook), with 109 guarantees issued. For the NHG, Sydney’s north-west (particularly Box Hill, Marsden Park and Riverstone) recorded the largest volume of guarantees (158).

According to the Australian Bureau of Statistics, the number of new home loans fell by 4.3 per cent in August, the largest drop since the Covid lockdowns of 2020.

Its month-on-month figures show new loans to owner-occupier first home buyers dropped 3 per cent—its seventh consecutive fall. Year-on-year loan commitments have slid 2.1 per cent since August 2020, the first through-the-year decline in two years.

“Similar to the value of owner-occupier commitments, states and territories with greater lockdown restrictions had the largest falls in the number of first home buyer loan commitments,” ABS head of finance and wealth Katherine Keenan said.

“New South Wales fell 11.5 per cent, Victoria fell 3.8 per cent and the Australian Capital Territory fell 12.7 per cent. The only rises were in Queensland (1.3 per cent) and Western Australia (3.7 per cent).”

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