- The fear of missing out is overriding fears of overpaying as Australians feel burnt by the home buying experience, according to a new survey
- According to ME’s new Quarterly Property Sentiment Report, overall buyer and seller sentiment in the residential property market has fallen seven percentage points to 42 per cent
- Overall, 91 per cent of survey respondents said ‘housing affordability is a big issue in Australia’ — rising to 93 per cent among first home buyers
- First home buyers feel particularly burnt by current market conditions, but they are worried about missing out as over half of first home buyers this quarter said they are looking to purchase property in the next 12 months
- Contributing to a decrease in positive sentiment this quarter is a fall in the perceived availability of residential property
The fear of missing out is overriding fears of overpaying as Australians feel burnt by the home buying experience, according to a new survey.
Despite historically low-interest rates, affordability and supply concerns continue to dampen Australian homebuyers’ spirits, according to ME’s new Quarterly Property Sentiment Report,
Overall, the survey found buyer and seller sentiment in the residential property market has fallen seven percentage points to 42 per cent.
Buyers across all segments are sweating on climbing house prices across the nation with 91 per cent of survey respondents said ‘housing affordability is a big issue in Australia’ — rising to 93 per cent among first home buyers.
An overwhelming 82 per cent of the property buyers surveyed said they ‘feel worried about paying too much for property in the current market’.
First home buyers feel particularly burnt by current market conditions, recording the lowest level of positive sentiment this quarter, down three percentage points to 24 per cent, while investors recorded the highest at 52 per cent.
Despite this feeling, first home buyers are worried about missing out as over half of first home buyers this quarter said they are looking to purchase property in the next 12 months.
This sentiment is carried across all buying segments, as ME’s findings revealed over half of those looking to buy ‘feel a sense of FOMO [fear of missing out]’ in buying property in the current market.
“When property prices and interest rates lowered last year during the pandemic, a unique buying opportunity opened up for confident first home buyers with cash savings and secure employment, while many investors became nervous,” ME head of home loans and personal banking Claudio Mazzarella said.
“Now prices have rebounded strongly and affordability is going down, first home buyers aren’t feeling as positive,” he added.
Contributing to a decrease in positive sentiment this quarter is a fall in the perceived availability of residential property.
Overall, 60 per cent of survey respondents believe there “isn’t enough choice in the current residential property market” — a 17 percentage point increase since January.
More regional buyers believe there isn’t enough choice, especially in regional New South Wales, compared to metropolitan buyers, according to the survey.
“With more city dwellers moving to sea or tree change areas, supply is dwindling and adding pressure to prices,” Mazzarella said.
While rising prices are diminishing the mood of first home buyers, the effect on existing owners is the opposite.
“Rising prices are making property owners feel wealthier, when many buyers are stretching their budgets to afford the limited but growing availability of stock on the market at the moment,” Mazzarella said.