- Three in four Aussies are delaying property purchases while waiting for prices to fall further.
- Interest rate uncertainty and affordability remain major barriers for buyers.
- The majority still believes home ownership is the best way to build wealth.
- Westpac says mortgage application activity has recovered from July lows.
According to the latest Westpac Home Ownership Report, two in five or 41% of Australians believe now is a bad time to buy, while almost half or 47% say it is a bad time to sell.
Three in four or 75% are holding off buying a property until prices fall further, while 73% are waiting for interest rates to stabilise before taking the plunge.
The report found current market conditions have prompted millions of Australians to delay major property decisions, creating what Westpac describes as a "pause" in market activity.
"The market has paused as people try to make sense of conflicting signals around interest rates, house prices, cost-of-living pressures and the broader economy," Westpac consumer chief executive Carolyn McCann said.
Affordability remains the biggest hurdle
Housing affordability remains the biggest factor shaping property decisions, cited by 40% of survey respondents.
Interest rate uncertainty was the next biggest concern at 32%, followed by falling property prices at 30%.
Westpac also found housing supply remains a challenge, with 31% saying there either aren't enough properties available or the homes on the market don't meet their needs.
Buyer caution is already showing up in mortgage demand, especially among first home buyers and younger Australians.
"While recent falls in house prices will be welcomed by first home buyers looking to enter the market, we also know that housing affordability and availability remain a major long-term challenge for many," Ms McCann said.
See also: Mortgage demand plunges as first home buyers, young Aussies retreat
Homeownership ambitions remain strong
Despite widespread hesitation, the report suggests Australians have not totally abandoned their property aspirations.
Westpac said their mortgage application activity is beginning to recover.
The bank, along with its big four peers, earlier reported a slump in new home loan volumes following the May budget.
"While we've seen a downturn in mortgage applications of around 5% since May, activity is beginning to recover with applications up 15% from the July low," Ms McCann said.
Confidence in property as a long-term wealth-building strategy also remains resilient, with 81% of Australians agreeing that home ownership is still the best way to build wealth.
Nearly four in five, or 79%, first home buyers said they feel more motivated to buy a property now than they did 12 months ago.
More than half of all respondents (55%) intend to make some form of housing change within the next year.
"Market conditions will continue to change, but for many Australians the dream of owning a home remains as strong as ever," Ms McCann said.
"But many buyers are worried about getting the timing wrong and are therefore weighing up whether prices could fall further, whether interest rates might move again and whether waiting could leave them in a better position."
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Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Extra Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.19% p.a. | 6.23% p.a. | $3,059 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.89% p.a. | 5.80% p.a. | $2,962 | Principal & Interest | Variable | $0 | $0 | 80% |
| Promoted | Disclosure | ||||||||||
5.99% p.a. | 5.95% p.a. | $2,995 | Principal & Interest | Fixed | $0 | $0 | 60% |
| ||||||||||||
6.23% p.a. | 6.23% p.a. | $3,072 | Principal & Interest | Variable | $0 | $395 | 70% | Disclosure |
