Lowering property prices not enough for first homebuyers

In good news for those hoping to own their own home, the property market is finally softening, with prices on the way down.

However, is the dip actually enough to help first home-buyers get their foot in the door?

According to Cotality, the latest clearance rate sat at 54.5 per cent, the lowest it’s been since the COVID-19 pandemic, with around 2681 auctions held over the weekend.

“Are people putting more properties up for auction because they’re worried about prices going down and they want to get in before prices fall? Or is three rate hikes too much for households? These are things you can read into those numbers,” Nine money editor Effie Zahos told Today.

“But it is certainly becoming a buyer’s market rather than a seller’s.”

However, for those sellers who are worried about the prices going down, Effie said she doesn’t believe the latest movement means anything “catastrophic” for them.

“Reading into the analysis, it is a more short-term drop, but for first-home buyers, they are probably looking at this wondering if this is a good time to buy,” she said.

“But the borrowing power is dropping faster than the prices - Westpac is predicting another couple of rate hikes and the fact is, we can’t borrow as much because of the interest rates.

“So are we at the point of rock-bottom bargains for first home buyers? No.”

Watch the full interview with Effie in the video above