25 September 2012

VIC survey

Utility bills & job security greatest concerns to VIC first homeowners
New homeowners not banking on rate cuts for greater financial stability
Victorian first homeowners who purchased in the last two years claim that soaring utility bills and fears over job security are their greatest financial concerns. These are the findings from the Victorian Mortgage Choice 2012 Recent First Homeowner Survey. Over one third of the state’s new first homeowners (34%) said that increasing utility bills, and the impact this may have on their ability to repay their home loan, was their greatest concern for 2012. This comes at a time when utility bills have risen in Melbourne by approximately 9% over the year to June*. The Mortgage Choice research also found a marked difference between the city and regional areas in levels of concern for rising utility bills, with 31% of Melbourne city residents rating this as their key issue compared to a staggering 50% of regional residents. After utility bills, Victorian recent first homeowners were most concerned about job security, at 16% of respondents. This has increased by almost two thirds since 2011 when only 10% of respondents listed this as their main concern. The change suggests that fears of a prolonged economic slowdown are affecting the confidence of recent homeowners in relation to retaining their job. Interest rates were the third most topical issue this year following job security. In 2011, almost half (45%) of the state’s survey respondents reported that interest rate movements were their greatest concern. However, with increased speculation of a cash rate cut by the Reserve Bank before the year’s end, this number has fallen in 2012 to only 11%. Local Mortgage Choice mortgage broker, Shaun Curtis said, “Soaring utility bills and fears of an economic slowdown have been big news this year and our research shows that recent first homeowners in Victoria are, like many people across the country, monitoring the situation very closely.” “It is no surprise that interest rate movements are less of a concern than last year. If they do fall further as many are speculating, it could help homeowners claw back some of the money spent on rising utility bills and other living costs, particularly for regional Victorian homeowners who are struggling with higher costs.” The annual Mortgage Choice survey revealed that in 2012 almost two thirds (63%) of recent first homeowners had saved for two years or more. This is a turnaround from 2011, when the majority (51%) had saved for two years or less. This year’s survey also found that the bulk (65%) of recent first homeowners in Victoria had found their ideal property in 12 months or less, compared to 66% in 2011. When broken down into city and regional areas, Melbourne recent first homeowners were much quicker at settling on a property, with 67% of buyers finding their first home in less than 12 months, compared to 55% of regional buyers. Shaun commented, “In comparison to last year’s survey respondents, Victorian recent first homeowners have taken more time to save for their deposit. However, the majority had still found their ideal home in less than twelve months, with Melbourne beating their regional counterparts to settlement date.” “This trend is likely to be a result of a number of factors, most notably Australians’ growing penchant to save and Victorian buyers’ eagerness to jump into the market quickly when property prices were declining and interest rates were steady or falling. We would expect that some buyers were waiting in the wings to take advantage of these favourable conditions, having spent the past few years saving hard for a larger deposit.” Visit Shaun Curtis’s website at http://www.mortgagechoice.com.au/cheltenham1 or call +61 3 9585 7779

* 6401.0 - Consumer Price Index, Australia

Table 1: Biggest concerns
2012 2012 2012 Biggest concern for 2012 Victoria (%) Melbourne (%) Regional (%) Utility bills 33.9 30.9 50.0 Job security 16.3 17.5 10.0 Interest rates 11.3 11.5 10.0 The state of the global economy 8.2 9.2 2.5 Fall in housing prices 7.8 8.8 2.5 Other cost of living 5.1 6.0 0.0 Carbon tax 5.1 5.1 5.0 Economic management at Federal Government level 4.7 4.1 7.5 Petrol prices 2.3 1.8 5.0 Rise in housing prices 1.6 1.8 0.0 Food costs 1.6 0.9 5.0 Economic management at State Government level 0.4 0.5 0.0 Other 2.0 1.8 2.5 Note: In 2011, ‘Utility bills’ was combined with ‘Other costs of living’. 2011 Victoria (%) N/A 9.5 45.0 N/A 3.7 23.8 N/A 4.2 1.6 5.3 5.3 0.0 1.6

Table 2: Savings habits
How long buyers had saved 0-6 months 7-12 months 1-2 years 2-3 years 3-5 years More than 5 years 2012 2012 2012 Victoria (%) Melbourne (%) Regional (%) 5.4 3.7 15.0 10.9 11.1 10.0 20.2 19.8 22.5 19.8 20.7 15.0 20.2 21.2 15.0 23.3 23.5 22.5 2011 Victoria (%) 15.3 13.2 22.8 16.4 18.0 14.3

Table 3: Property hunt
Length of the property hunt 0-6 months 7-12 months 1-2 years 2-3 years 3-5 years More than 5 years 2012 2012 2012 Victoria (%) Melbourne (%) Regional (%) 37.0 37.8 32.5 28.4 29.5 22.5 21.0 19.4 30.0 7.0 6.5 10.0 4.3 4.6 2.5 2.3 2.3 2.5 2011 Victoria (%) 42.3 23.8 23.8 6.3 1.1 2.6

For further information or to arrange an interview please contact: Shaun Curtis Mortgage Choice +61 3 9585 7779 shaun.curtis@mortgagechoice.com.au
About the survey The Mortgage Choice 2012 Recent First Homeowner Survey of 910 Australians (257 Victorians) who had bought their first home in the past two years, ran online in September 2012. About Mortgage Choice Australia’s largest independently-operated mortgage broker, Mortgage Choice has sourced a home loan for well over 350,000 people since 1992. It works with all manner of property finance borrowers via hundreds of franchises. The company writes almost in every 20 home loans in Australia by providing professional guidance on, and choice of, products offered by an extensive panel of leading lenders. Many of its brokers provide a broader service, helping customers source commercial and personal loans, asset finance, deposit bonds and risk and general insurances. Uniquely, Mortgage Choice pays its franchisees the same commission rate for home loans they write, regardless of rate paid by the lender a new customer selects, working in the customer’s best interests to tailor a solution to them. The company has no balance sheet or funding risk, and consistently delivers strong profits and attractive yields. It listed on the ASX in 2004 (MOC) and is a member of the Mortgage & Finance Association of Australia (MFAA). Recent recognition: 2012, 2011 Australian Broking Awards Major Brokerage of the Year – Franchise; 2012 Australian Broking Awards Best Training and Education; 2012 Australian Broking Awards Best Ethical/Social Responsibility Program; No.1 on The Adviser magazine’s 2012, 2011, 2010 and 2009 Top 25 Brokerages list; 2012, 2010, 2009, 2008, 2006 and 2005 MFAA Awards Retail Aggregator/Originator of the Year; 2011, 2010, 2009 and 2008 10 Thousand FEET Top 10 Franchise list; 2010 Forbes Asia-Pacific Best Under A Billion list. Mortgage Choice holds an Australian Credit Licence: no. 382869, issued by ASIC. Visit www.mortgagechoice.com.au or call customer service on 13 MORTGAGE.

Sign up to vote on this title
UsefulNot useful