The apparent slump in first-home buyer numbers isn’t quite as bad as analysts thought.
Lenders have been found to be under-reporting their loans to first-home buyers because some have only been including first-home owner loans that have attracted a government grant.
The Australian Bureau of Statistics have found the under-reporting in an investigation and it has meant a 20 per cent jump in the number of first-home buyer loan statistics.
Jacky Hodges is from the ABS and spoke to Broker News Online.
“Initially we thought the fall off in first home buyer loans over the last two years was due to reduced affordability arising from changes in grants, rising house prices, increased investment housing loan activity and general economic conditions,” she said.
“However, subsequent analysis and follow-up with lenders has confirmed that the drop was partly due to under-reporting by some lenders.”
From this point going forward, the ABS and the Prudential Regulation Authority will make sure all first-home buyer loans are recorded whether they attract a government grant or not.
The ABS said the actual total value of home lending was not at all affected by the finding.
The under-reporting began when grants were only applied by state governments to newly constructed homes instead of all homes around the country between 2012 and 2013 depending on which state you were in.
“Loans to first-home buyers were therefore underestimated in these states from the dates specified due to some lenders under-reporting. Other lenders have reported correctly throughout,” Ms Hodges said.