HomeStart credited with return of first-home buyers

Mortgages for first-home buyers in Auckland plunged to 637 in February 2014. Photo / Thinkstock

And they’re buying in swanky and highly scenic parts of Auckland, figures reveal.

First-home buyers are back on the Auckland property ladder — and are also setting their sights on some of Auckland's most scenic real estate.

Statistics released by Data Insight show the number of property sales registered as first-home buyers spiked in April, with 986 mortgages being approved for such buyers, up from 826 12 months earlier.

It is more than a year since the number of first-home buyers significantly outperformed the previous year after the introduction of loan-to-value ratio (LVR) changes in late 2013. It was also the highest number of mortgages for first-home buyers since November 2013, when 1079 mortgages were registered.

Mortgages for first-home buyers in Auckland plunged to 637 in February 2014.

Real Estate Institute boss Colleen Milne said the rise of new property owners was evidence the KiwiSaver HomeStart scheme was helping people into their first homes. "It is a fantastic result to see that bank loans are increasing to first-home buyers and that they are confidently returning to the Auckland market for the first time since the introduction of the LVR," she told the Herald on Sunday.

"Much of this can be attributed to the new HomeStart scheme."

HomeStart, introduced on March 31, allows Auckland couples who have been part of KiwiSaver for five years and who are buying their first home a $10,000 grant towards a deposit on existing properties, or $20,000 on a new property with a value up to $550,000.

The earlier dip in first-home purchases in Auckland followed changes the Reserve Bank introduced in October 2013 in a bid to cool the hot property market, including restrictions on mortgage seekers who had an LVR of more than 80 per cent of a home's value.

In May the Reserve Bank further tweaked LVR rules, meaning from October Auckland property investors would need a 30 per cent deposit. To recognise more subdued housing markets outside Auckland, the bank will increase the speed limit for high LVR borrowing from 10-15 per cent.

Core Logic statistics revealed first-home buyers were forsaking recognised entry-level suburbs in the Auckland region. In the first three months of the year, 48 per cent of homes sold in One Tree Hill were bought by first-home buyers, making it Auckland's second most-popular area for new home owners.

Just 15 per cent of One Tree Hill properties bought in the first three months of 2013 were bought by first-home owners.

Laingholm, a small community in the Waitakere Ranges, was the No1 location for property newbies in the first quarter of 2015, first-home owners accounting for 65 per cent of property purchases. The level of first-home buying also increased in Beach Haven, Sunnyvale, Goodwood Heights, Mangere and Favona.

The latest QV House Price Index shows the average value for homes in suburbs in the ex-Auckland City Council area stands at $1,003,144.