Surge in first-home buyers

CENTRAL Tablelands Finance owner Vince Ferrito expects first home owners in Orange to enter the market in 2014, after it was flooded by investors last year. 

Mr Ferrito said first home buyers were pushed out when the government axed the first home owners grant for existing homes, and investors bought up big in Ornage.

He said the trend of buying investment properties in the city kicked off a few years ago, and partly explains why fewer people  in Orange own their own home outright than in 2001. 

But Mr Ferrito noticed a surge of investment buyers in 2013. 

“I think it may start to balance out again this year because the first home owners should start to enter the market again ... they’ve had a bit of time to save more money,” he said. 

According to Australian Bureau of Statistics census data, fewer people owned their own home outright in 2011, compared to the 2006 and 2001 censuses, but there were more people with mortgages. 

Mr Ferrito said investors took advantage of the market and started to use their own homes as equity to buy investment properties, rather than cash deposits. 

“It’s a very good idea ... it is the same risk as if you put down $50,000 of your own money,” he said. 

“You use your own home as equity and you always have the option of selling the investment property.”

In 2001, 4888 people owned their own home outright in the Orange local government area, compared to 4337 in 2006 and 4425 in 2011.

But in 2001, 3478 people had a mortgage for their own home, compared to  4149 in 2006 and 4516 in 2011.  

nicole.kuter@fairfaxmedia.com.au

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