Proportion of first home buyer loans down: Finders

According to the latest report released by financial comparison website, the proportion that first home buyer loans make up of total loans is at an all-time low.

Drawing on data from the ABS, the report notes that first home buyer loans now make up just 12.5% of all loans financed in November 2013, down 3% from the same month in 2012.

Finder’s report attributes the drop of 1,054 first home buyer loans in the 12 month period to the volume of capital now required to purchase a first home.

According to Michelle Hutchison, a money expert at, the upfront costs associated with financing a home are putting off first home buyers.

“For a 5% deposit and purchasing an established home at the median dwelling price, the upfront cost is up to double the size of the deposit, according to research,” said Mrs Hutchison.

The website calculated that when purchasing home at the national median dwelling price of $484,563, where stamp duty concessions are exempt, a first home buyer could expect that with a 5% deposit of $24,228, they would also be required to pay $22,000-$50,000 for stamp duty and lenders mortgage insurance, plus about $1,000 in home loan fees.

Data from the ABS shows that the average loan size to a first home buyer in November 2013 was $298,000, $10,000 greater than it was in November 2012.

Tracking long term trends, ABS figures also show that the household incomes of first home buyers has trended upwards over the last two decades; in 1995, the average weekly household income of a first home buyer was $1,307, while in 2010 it was $2,006 (both in 2009-10 dollars).

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