This was the title of a press release that we sent out in early February. the point of the press release was to advise that the market was going to go into shock when it came to the number of first home buyers hitting the market with the anticipated end date of the boosted First Home owners grant. Needless to say, we were spot on and probably the first to predict it, although a fairly obvious predicition. We had coverage on Channel 9 news and in a number of local papers such as the North Shore Times in Sydney.

We predicited this was going to occur based on the grant expiring, rent becoming more expensive then mortgage repayments in some areas and very low interet rates. Our predicitons were confirmed with agents and developers over the last 2 months stating that anything under $600,000 was flying out the door. The rush was on from First home buyers to secure a property before the grant expired. Further to this the banks have been making it difficult for some as lending criteria has changed and the huge demand for new loan applications has slowed banks cycles rates dramtically.

Now we will wait to see how the Government reacts to what has occured since October 08 and what adjustments if any they will make to the boosted FHBG.

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Lenders, Banks and Non Banks, are struggling to keep pace with an unexpected increase in applications from first-home buyers due to the first home buyers grant deadline at the end of June this year. Some banks are taking as long as a month to approve loans. This is resulting in some buyers missing their settlement dates.

The banks new lending policies and the poorly organised applications by new borrowers is hampering the banks efforts to approve and allocate loans ontime.

Banks are now hiring more staff to cope with the demand… a reversal from 6 months ago when banks were letting go staff in their home loan lending divisions.

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Government figures have now confirmed what many of us have being saying for months… and that is, it is cheaper to buy than rent in some cases. It is the perfect time for those looking to purchase a home. Prices have stabled, rents are increasing and interest rates have dropped significantly over the last 8 months. This has created, along with the boosted FHOG, plenty of activity in the affordable hosuing market with anything under $600,000 being snapped up by interested parties. There are thousands more home buyers on the prowl at the moment and this is great for the stability of the property market in Australia.

While interest rates are low, and some expect it to go lower during 2009, now is the time to be house hunting with a pre approved mortgage so when you find a home that suites, you can bid confidently at auction or negotiate a private sale.

Good luck with house hunting!

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